SIGAR. Special Inspector General for Afghanistan Reconstruction QUARTERLY REPORT TO THE UNITED STATES CONGRESS

Transcription

1 SIGAR JULY Special Inspector General for Afghanistan Reconstruction 30, 2009 QUARTERLY REPORT TO THE UNITED STATES CONGRESS

2 SIGAR Special Inspector General for Afghanistan Reconstruction The National Defense Authorization Act (P.L ) established the Special Inspector General for Afghanistan Reconstruction (SIGAR). SIGAR s mission is to enhance oversight of programs for the reconstruction of Afghanistan by conducting independent and objective audits, inspections, and investigations on the use of taxpayer dollars and related funds and by keeping the Congress, as well as the Secretaries of State and Defense, currently informed of reconstruction progress and weaknesses. Afghanistan reconstruction includes any major contract, grant, agreement, or other funding mechanism entered into by any department or agency of the U.S. government that involves the use of amounts appropriated, or otherwise made available for the reconstruction of Afghanistan with any private entity to: build or rebuild physical infrastructure in Afghanistan; establish or re-establish political or societal institutions of Afghanistan; provide products or services to the people of Afghanistan. a a P.L National Defense Authorization Act for FY 2008, 1/28/2008. Cover Captions (clockwise): An Afghan girl sits outside at her elementary school in Bamyan Province. (SIGAR photo) An Afghan laborer works on the construction site of a new police academy in Bamyan Province. (SIGAR photo) Afghans post campaign signs in preparation for the upcoming presidential and provincial council elections, the first run by Afghanistan s Independent Election Commission since the Taliban was overthrown. (UN photo) Afghan National Police recruits participate in entry-level training at the Central Training Center in Kabul. U.S. forces play a role in training recruits, who attend an eight-week program of instruction. (DoD photo)

3 Special Inspector General for Afghanistan Reconstruction July 30, 2009 It is with pleasure that I am submitting to the Congress the fourth quarterly report of the Office of the Special Inspector General for Afghanistan Reconstruction (SIGAR). This report, which complies with the requirements outlined in Section 1229 of P.L , documents SIGAR s progress since the April 30, 2009, quarterly report. It also provides an update on the status of reconstruction programs in Afghanistan, for which funding since 2002 totals approximately $38 billion. SIGAR has made significant progress this quarter. We issued three audit reports and one inspection report and have seven additional audits and four inspections well under way. Our office also initiated preliminary inquiries into 23 allegations of fraud, waste, and abuse. As of the end of July, we increased our staff from 32 to 44, and we expect to hire 7 more professionals by the end of August. With 11 auditors, 7 inspectors, and 4 investigators currently on board, SIGAR has increased its capacity to provide oversight of reconstruction programs. In addition, I made two trips to Afghanistan and met with officials from the U.S. Embassy, the international community, and the Government of the Islamic Republic of Afghanistan (GIRoA), including President Hamid Karzai, all of whom are involved in reconstruction efforts. The people of Afghanistan and the international community are focused on supporting the upcoming presidential and provincial council elections and improving security. The August 20 elections the second since the Taliban was removed from power and the first conducted by Afghanistan s Independent Election Commission (IEC) are an important milestone in Afghanistan s journey toward establishing a representative government that answers to the needs of its citizens. The United States has committed significant resources to supporting the electoral process, and SIGAR is making the use of these resources an oversight priority. In July, SIGAR provided one report to the U.S. Ambassador to Afghanistan, with a recommendation to help strengthen Afghanistan s electoral institutions capacity to manage elections. Following the August elections, SIGAR will issue an audit report on the extent to which U.S. and international assistance was used effectively and another report identifying lessons learned that could facilitate future elections. We also will produce a report assessing the participation of women in the elections. More than half of all reconstruction dollars have been allocated to build the Afghan National Security Forces (ANSF). SIGAR s audit examining the ability of the Combined Security 2221 Clark Street, Suite 800 Arlington, Virginia 22202

4 Transition Command - Afghanistan (CSTC-A) to monitor contractor performance found that CSTC-A, which is responsible for the training program, did not have the mechanisms in place to ensure funds were managed effectively and spent wisely. The Commanding General of CSTC-A concurred with our recommendations and is acting to establish proper contract management and oversight processes. We are currently examining the controls and accountability mechanisms for the Commander s Emergency Response Program (CERP) and will complete our audit during the next quarter. This quarterly report is divided into four sections. Section 1 discusses recent developments pertaining to reconstruction. Section 2 describes SIGAR s completed, ongoing, and planned work. Section 3 provides an overview of the status of the reconstruction program under the three pillars security; governance, rule of law, and human rights; and economic and social development identified in the Afghanistan National Development Strategy (ANDS). Although the U.S. agencies involved in rebuilding Afghanistan provided most of the information in this section, SIGAR also drew on official documents, independent studies, and reports by international organizations to compile as complete a picture as possible of the reconstruction effort in Afghanistan. Section 4 offers a summary of work done by other oversight agencies. The Congress recently passed a bill that increased SIGAR funding and also provided a more expedient hiring authority. On behalf of my office, I thank the Congress for providing the financial resources for SIGAR to successfully conduct oversight of the expanding reconstruction program. My observations have led me to conclude that strong oversight of this program is critical to achieving U.S. goals in Afghanistan. Very respectfully, Arnold Fields Major General, USMC (Ret.) Special Inspector General for Afghanistan Reconstruction 2221 Clark Street, Suite 800 Arlington, Virginia 22202

5 ISLAMIC REPUBLIC OF AFGHANISTAN

6 TABLE OF CONTENTS SECTION 1 AFGHANISTAN OVERVIEW Elections 4 Security 5 Corruption 6 International Cooperation 7 The Afghanistan-Pakistan Strategy 9 Inter-agency Coordination 9 SECTION 2 SIGAR OVERSIGHT Audits 13 Inspections 18 Investigations 23 SIGAR Budget 24 SECTION 3 RECONSTRUCTION UPDATE Status of Funds 33 Security 45 Governance 63 Economic and Social Development 83

7 TABLE OF CONTENTS SECTION 4 OTHER AGENCY OVERSIGHT Completed Oversight Activities 101 Ongoing Oversight 102 Other Agency Investigations 109 Other Agency Inspections 111 APPENDICES Appendix A: Cross-reference of Report to Statutory Requirements 114 Appendix B: U.S. Government Appropriated Funds 118 Appendix C: SIGAR Audits 120 Appendix D: SIGAR Inspections 121 Appendix E: SIGAR Hotline 122 Appendix F: Acronyms and Defi nitions 123 ENDNOTES 125

8 Nangarhar Provincial Reconstruction Team An Afghan engineer talks with U.S. Air Force Capt. Paul Frantz during a visit by the Nangarhar provincial reconstruction team (PRT) to a local metal-working shop. The team is responsible for helping the Government of the Islamic Republic of Afghanistan (GIRoA) improve security and governance and for promoting reconstruction in Nangarhar Province. The PRT assesses community needs and then builds schools, government centers, roads, medical capability, and basic infrastructure throughout Nangarhar; it also mentors Afghan government officials and security forces to provide the Afghan people with the state representation and security they need. (U.S. Air Force photo, SSgt Joshua T. Jasper)

9 1 AFGHANISTAN OVERVIEW Introduction: The Year of Transfer Rise in Income Expanding Iraqi Security Authority Afghanistan Reconstruction Update Afghanistan Audits Afghanistan Inspections Reconstruction Teams The Role of the International Community Anticorruption Efforts Security Security Conditions Still Hinder Reconstruction Activities Concerned Local Citizen Initiative Legislative Developments The Human Toll 1

10 AFGHANISTAN OVERVIEW Within Afghanistan, we must help grow the economy, while developing alternatives to the drug trade by tapping the resilience and the ingenuity of the Afghan people. We must support free and open national elections later this fall, while helping to protect the hard-earned rights of all Afghans. And we must support the capacity of local governments and stand up to corruption that blocks progress. U.S. President Barack Obama 1 2 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

11 AFGHANISTAN OVERVIEW AFGHANISTAN OVERVIEW The U.S. reconstruction mission in Afghanistan has expanded significantly since the last quarterly report of the Special Inspector General for Afghanistan Reconstruction (SIGAR) to Congress. U.S. President Barack Obama signed the Supplemental Appropriation for FY 2009 (P.L ), raising the U.S. commitment to rebuild Afghanistan to over $38 billion. This legislation also provided the additional funding SIGAR needs this year to conduct its oversight mission. The administration s FY 2010 budget request likely will bring the investment in Afghanistan s reconstruction close to $50 billion. As the funding to rebuild Afghanistan increases, so will the demand for oversight, which is critical, not only to prevent fraud, waste, and abuse, but also to ensure the reconstruction program is as successful and cost-efficient as possible. Two strategies the Afghanistan National Development Strategy (ANDS) and the new U.S. government policy for stabilizing Afghanistan provide the framework for the U.S. reconstruction effort in Afghanistan and the work of SIGAR. During this quarter the United States began executing its new strategy, which emphasizes inter-agency coordination, international cooperation, and the integration Special Inspector General for Afghanistan Reconstruction Arnold Fields sat down with Bamyan Provincial Governor Habiba Sorabi during his July 2009 visit to Afghanistan. Sorabi is the first female governor of any Afghan province. Efforts to improve gender equality in Afghanistan are one of the focuses of the U.S. reconstruction effort. (SIGAR photo) REPORT TO THE UNITED STATES CONGRESS I JULY 30,

12 AFGHANISTAN OVERVIEW The U.S. has no favorite candidate; our stance is neutral on the outcome. We are encouraging the Afghans to determine the issues, demand that candidates explain the programs, and vote for the future in an electoral process that is credible, secure, and inclusive. These elections can show continued evolution toward a government that reflects and responds to Afghan popular will. Ambassador Richard C. Holbrooke, Special Representative for Afghanistan and Pakistan 2 of security and development assistance to promote a more capable, accountable, and effective government in Afghanistan. In addition to deploying more troops to improve security, the U.S. government also began recruiting more civilian experts to expand provincial reconstruction teams (PRTs), district support teams, and the U.S. diplomatic presence in the provinces. Over the past quarter, the United States has focused on five key reconstruction issues: elections, security, corruption, international coordination, and the relationship between Afghanistan and Pakistan. SIGAR has completed work in two of these areas and has ongoing work in four of them. SIGAR s mandate does not include assistance to Pakistan. However, SIGAR will be examining the effect of cross-border programs, when they are implemented, on reconstruction in Afghanistan. ELECTIONS The United States views the August 20, 2009, presidential and provincial council elections the second in Afghanistan since the Taliban was removed from power, and the first to be conducted by the Independent Election Commission (IEC) of Afghanistan as a critical step toward developing a government that is accountable to its citizens. 3 U.S. and international funding has been provided to help Afghanistan build the institutional capacity to conduct not only these elections but also future elections. Because of the importance attached to elections, SIGAR is conducting a comprehensive audit that will produce four separate reports about aspects of the election process. SIGAR provided the first report, containing a recommendation for strengthening the capacity of Afghanistan s electoral institutions to manage elections, to the U.S. Ambassador to Afghanistan in July. SIGAR will issue the following additional reports over the next several months: 1) an assessment of the extent to which U.S. and international assistance was used effectively to support these elections and to develop a sustainable election process; 2) an analysis of the lessons learned, to improve the process for future elections; and 3) and an evaluation of the participation of women in these elections. The U.S. government has provided approximately $120 million to the United Nations (UN) for elections support. 4 The UN Development Programme s Enhancing Legal and Electoral Capacity for Tomorrow (UNDP-ELECT), the office managing and coordinating international donor support, including that from the United States, has budgeted $224 million to support the elections. USAID is funding separate election-related projects through a number of local monitoring groups, as well as through non-governmental organizations (NGOs) such as the International Republican Institute, the National Democratic Institute, and the International Foundation for Electoral Systems. 4 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

13 AFGHANISTAN OVERVIEW Voter Registration and Election Safeguards All Afghan citizens who voted in the 2004 and 2005 elections can use their registration cards for the upcoming elections. The IEC also conducted a four-phase voter-registration campaign between October 2008 and February 2009 to allow Afghan citizens who had lost their registration cards, moved within the country, or become eligible to vote after 2005 to register. The IEC recently re-opened the registration period for an additional 20 days in all 34 provinces. According to the IEC, more than 4.5 million people, about 38% of whom are women, have registered in the past eight months. Approximately 17 million voter cards are now in circulation. A number of safeguards are in place to protect the integrity of the 2009 elections, according to the IEC. Specifically, the IEC is planning to carefully track and control the movement of sensitive materials, including ballots; use numbered seals to close ballot boxes; and mark voters fingers with indelible ink to prevent individuals from voting more than once. Security for the Elections Primary responsibility for providing security for the elections rests with the Afghan National Security Forces (ANSF), backed by the International Security Assistance Force (ISAF). A Joint Security Planning Group was established to streamline planning among the ANSF, the ISAF, the Combined Security Transition Command - Afghanistan (CSTC-A), the IEC, and the UN. This planning group is addressing issues concerning candidate security, the secure distribution of election materials, the establishment of provincial operations command centers, and security for polling sites. SECURITY U.S. and international groups are providing aid to Afghanistan for elections support in the run-up to the August 20, 2009, presidential and provincial elections the first orchestrated by Afghanistan s Independent Election Commission since the Taliban was overthrown. (SIGAR photo) Security continues to pose a major challenge to the reconstruction effort in Afghanistan. The UN reported an increased number of security incidents, especially in the southern and eastern parts of Afghanistan, over the past three months. The situation in Kandahar, where insurgents attacked the provincial council headquarters and the governor s compound in separate incidents in April and May this year, has caused particular concern. 5 During this reporting period the United States began deploying additional troops to improve security in the troubled provinces in the south and east, bordering Pakistan. At the same time, the United States also took important steps toward achieving its primary strategic goal to build Afghan National Army (ANA) and Afghan National Police (ANP) forces capable of ultimately assuming full responsibility for the security of the country. Of the approximately $5 billion provided for Afghanistan reconstruction in P.L , more than $3.6 billion will go to train and equip the ANSF. This money will be used to accelerate efforts to build a 134,000- strong ANA and an ANP force of 86,800 by More than half of the $38 billion REPORT TO THE UNITED STATES CONGRESS I JULY 30,

14 AFGHANISTAN OVERVIEW ANA Maj. Gen. Mohammad Dawran thanks U.S. Air Force MSgt Richard Woods, director of the senior leaders maintenance course, for explaining a storyboard depicting an Afghan deployment. Dawran, commander of the Afghan National Army Air Corps, is visiting the installation to learn more about the Air Education and Training Command s air advisor course. (U.S. Air Force photo, SSgt Nathan G. Bevier) in reconstruction dollars appropriated since 2002 has been allocated for building the ANA and ANP. CSTC-A, in conjunction with the Government of the Islamic Republic of Afghanistan (GIRoA), and U.S. coalition partners, is the joint command responsible for the management of U.S. programs to develop the ANSF. Because of the importance the United States attaches to the training mission, SIGAR s first audit reviewed CSTC-A s management of a $404 million contract to provide training and training support for the ANSF in 17 locations throughout Afghanistan. The audit found CSTC-A did not have the capability to ensure U.S. funds were managed properly and spent wisely. CSTC-A concurred with the findings of the audit and responded that it was acting to establish proper contract management and oversight processes. In July, SIGAR learned that a team of contract specialists from the Defense Contract Management Agency had arrived in Afghanistan to deal with the issues raised in the audit. On July 17, 2009, the CSTC-A commander informed SIGAR that, as a result of the issues raised in the audit report, the contract specialists were conducting a review of the contract management and oversight for all CSTC-A contracts funded by the ASFF. CORRUPTION The United States and its partners in the international community continue to be concerned about public corruption in Afghanistan. Afghan officials, includ- 6 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

15 AFGHANISTAN OVERVIEW ing President Hamid Karzai, have asked SIGAR to help them reduce corruption. SIGAR cannot provide anticorruption training to the Afghans, but it can provide an independent and objective assessment of capabilities and assistance to reduce corruption. SIGAR has two audits under way to evaluate the GIRoA s capacity at the national and provincial levels to establish the internal controls and the accountability measures needed to deter corruption. These audits are assessing U.S. and international efforts to develop the GIRoA s capacity to deter corruption. They are also examining how Afghan officials at the national and local levels control and account for the flow of funds. SIGAR will publish the first in a series of findings later this year. INTERNATIONAL COOPERATION The U.S. strategy for Afghanistan and Pakistan emphasizes increasing international dialogue and integrating international assistance. Since announcing the strategy earlier this year, the United States has participated in several international conferences that focused on stabilizing Afghanistan. Each of these meetings endorsed the central role that the UN Assistance Mission to Afghanistan (UNAMA) has in coordinating international aid to Afghanistan. U.S. officials say they are working with the international donor community increasingly, under the auspices of UNAMA to develop a common framework to guide and integrate international aid to Afghanistan. 6 In his recent report to the UN Security Council, the UN Secretary-General said donor coordination has improved, in part as a result of greater international consensus on reconstruction objectives. He noted that the Joint Control U.S. and international assistance is expanding access to education and health care for Afghan children, including girls. (SIGAR photo) REPORT TO THE UNITED STATES CONGRESS I JULY 30,

16 AFGHANISTAN OVERVIEW Special Inspector General for Afghanistan Reconstruction Arnold Fields visits a women s prison, where young children are allowed to stay with their incarcerated mothers. One of the goals of the ANDS is to reform the prison system and create better facilities for women and children. (SIGAR photo) Monitoring Board (JCMB), which was established in 2006 to coordinate international assistance with the GIRoA, has also made progress. 7 Over the past three months, JCMB has approved police reform measures, adopted a new agricultural development strategy, and established priorities for private sector development. 8 International coordination of projects is essential to maximize the impact of reconstruction dollars. SIGAR has begun a series of sector audits to examine the degree to which projects have been coordinated across U.S. government agencies, as well as with other international donors. The first of these audits is evaluating assistance to the energy sector. SIGAR will issue this report in the next quarter. The 26 provincial reconstruction teams (PRTs) 12 led by the United States and 14 by coalition allies play an important role in the international effort to stabilize and rebuild Afghanistan. In June 2009, SIGAR attended the second annual PRT conference, which brought together the civilian and military leadership of the North Atlantic Treaty Organization (NATO) and non-nato members of ISAF to improve international coordination of reconstruction projects. SIGAR is inspecting the management and operational capabilities of all the PRTs in Afghanistan. It began this series of inspections with the PRT in Farah Province and will issue a report during the next quarter. SIGAR is currently inspecting the Parwan-Kapisa PRT, which is located at the Bagram Air Base. 8 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

17 AFGHANISTAN OVERVIEW THE AFGHANISTAN-PAKISTAN STRATEGY Because U.S. decision-makers believe conditions and events in Pakistan have an impact on developments in Afghanistan, they are encouraging greater cooperation between the two countries and seeking increased assistance for Pakistan as well as Afghanistan. 9 In May, the United States brought the military and civilian leaders of Afghanistan and Pakistan together to discuss greater regional cooperation. As a result of these trilateral consultations, Pakistan and Afghanistan pledged to reach a trade agreement by the end of the year, open two additional border posts, increase cooperation in the agricultural sector, and accelerate cross-border infrastructure projects. These developments will likely affect reconstruction programs on the Afghan side of the border. INTER-AGENCY COORDINATION SIGAR is coordinating its audits, inspections, and investigations with other inspectors general and audit agencies through several forums. The Southwest Asia Joint Planning Group meets every three months and prepares quarterly reports on audit and inspection activities in Southwest Asia, including Afghanistan. A newly formed sub-group of the Southwest Asia Joint Planning Group meets periodically to discuss ongoing and planned work in Afghanistan and Pakistan. This planning group seeks to prevent duplication of effort and ensure that all important oversight issues are being addressed. Finally, SIGAR participates in meetings held every three weeks at the U.S. Forces - Afghanistan (USFOR-A) headquarters to coordinate oversight activities in Afghanistan. SIGAR investigators and attorneys also collaborate closely with their lawenforcement colleagues in other U.S. government agencies. SIGAR is a member of the International Contract Corruption Task Force (ICCTF), the principal organization coordinating federal criminal and civil cases that involve procurement fraud and corruption related to U.S. government spending in Southwest Asia. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

18 An Afghan reporter speaks with women about the importance of having radios and listening to the news. (U.S. Army photo, SPC Phoebe R. Allport)

19 2 OVERSIGHT SIGAR 11

20 To ensure that our programs operate according to the highest standards of effectiveness and integrity, we are committed to supporting the efforts of the Congressionally-mandated Special Inspector General for Afghan Reconstruction (SIGAR), as well as the Government Accountability Office (GAO) and State, USAID, and DoD Inspectors General. Ambassador Richard C. Holbrooke, Special Representative for Afghanistan and Pakistan SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

21 SIGAR OVERSIGHT AUDITS SIGAR issued three audit reports this quarter and has seven other audits under way. These audits cover a spectrum of reconstruction issues, including contract oversight, program management, and contractor performance, as well as reconstruction activities to improve security, foster good governance, and support economic development. Two of the audits were initiated recently to examine the U.S. and international efforts to strengthen the Afghan government s capacity at the national and provincial levels to establish internal controls and provide the accountability that is critical to preventing corruption. SIGAR believes that an important part of its oversight mission is to identify issues in real time and bring them to the attention of implementing agencies, so they can make immediate program adjustments to improve the effectiveness of the reconstruction program. In this spirit, SIGAR provided the U.S. Embassy in Kabul with a report recommending measures to strengthen Afghanistan s capacity to conduct elections. An audit examining the funding and implementation of programs related to the August 20, 2009, presidential and provincial council elections will be completed after the elections. SIGAR will also issue a report assessing the participation of women in the election process. The three audit reports issued during this quarter identified problems with contract oversight, information management, and capacity building. COMPLETED AUDIT REPORTS Contract Oversight Capabilities of the Defense Department s Combined Security Transition Command - Afghanistan (CSTC-A) Need Strengthening, SIGAR Audit 09-1 More than half of all U.S. reconstruction dollars provided for Afghanistan since 2002 have gone into training, equipping, and deploying the Afghan National Security Forces (ANSF). The Combined Security Transition Command - Afghanistan (CSTC-A), in conjunction with the Government of the Islamic Republic of Afghanistan (GIRoA) and U.S. coalition partners, is the joint REPORT TO THE UNITED STATES CONGRESS I JULY 30,

22 SIGAR OVERSIGHT command responsible for the management of U.S. programs to develop the ANSF, which includes the Afghan National Army (ANA) and the Afghan National Police (ANP). SIGAR s review of CSTC-A s management of a $404 million contract to provide training and training support for the ANSF in 17 locations throughout Afghanistan found that although CSTC-A is responsible for the management of the training programs for the ANSF, it does not have the capability to ensure that U.S. funds are managed effectively and spent wisely. At the time of the audit, CSTC-A had only one contracting officer s technical representative (COTR) located in Afghanistan to provide contract oversight. That official had limited contracting experience and training, and had been unable to make field visits to monitor contractor performance. Because a lack of oversight increases the likelihood that training funds may not be used as intended, SIGAR recommended that CSTC-A strengthen its oversight capabilities. Specifically, SIGAR suggested CSTC-A: obtain management staff who have the qualifications and training to conduct contract oversight work develop a program for contract oversight that includes visits to the field where the contractor is providing services CSTC-A concurred with the findings of the audit and responded that it was acting to establish proper contract management and oversight processes. CSTC-A also said it viewed SIGAR s audit as a mechanism to help it obtain the resources required to monitor the contract effectively. In July, during a follow-up visit to CSTC-A, SIGAR learned that a team of contract specialists from the Defense Contract Management Agency had arrived in Afghanistan to conduct a review of the contract management and oversight for all CSTC-A contracts funded through the ASFF. UN Action Urged To Strengthen Afghanistan Capacity To Support Future Elections, SIGAR Audit 09-2 SIGAR issued a letter report on July 6, 2009, related to the preparation and conduct of presidential and provincial council elections. Public distribution of the letter report is limited until after the August 2009 elections. Management Information Systems Available to Reconstruction Decision-Makers in Afghanistan, SIGAR Audit 09-3 SIGAR s review of the management information systems of the key U.S. agencies and commands in Afghanistan found that no single management 14 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

23 SIGAR OVERSIGHT information system provides full and accurate information of all finished, ongoing, and planned reconstruction activities. Having this information would help decision-makers to plan, coordinate, monitor, and report on reconstruction activities, and, if necessary, take corrective action. The lack of an integrated management information system increases the risk that U.S. resources may be wasted either through duplication of effort or because projects are in conflict with each other. Five agencies and commands the Department of State (DoS), the U.S. Agency for International Development (USAID), U.S. Forces - Afghanistan (USFOR-A), CSTC-A, and the U.S. Army Corps of Engineers Afghanistan Engineer District play major roles in the implementation of U.S.-funded reconstruction programs in Afghanistan. While each of these organizations said it uses established information systems for financial and accounting purposes, SIGAR found the availability and use of information systems for project management varied significantly and did not allow agencies and commands to easily share information about projects. Instead, most sharing of information between the agencies and commands occurred at periodic meetings and through ad hoc reports and presentations. Senior representatives from the main U.S. entities operating in Afghanistan agreed they would all benefit if they had access to a system that provided a common operating picture of the status of reconstruction projects. USAID, at the direction of the National Security Council Deputies Committee in late 2008, completed a study in June 2009 assessing the feasibility of a joint information management system for reconstruction activities. The USAID study provided recommendations that could form the basis for a broader coordinated effort to develop a robust system to share information on the reconstruction effort in Afghanistan. However, additional work, coordinated among the key U.S. implementing agencies, is now needed to jointly develop an integrated management information system for Afghanistan reconstruction activities. SIGAR has recommended the reconstruction stakeholders appoint an executive agent to coordinate the development of an integrated information system that takes into account the various systems currently used to collect reconstruction data and also identifies the resources needed to implement and sustain a new system. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

24 SIGAR OVERSIGHT ONGOING AUDITS Agencies Management Oversight, Procedures, and Practices for Reconstruction Funds and Projects SIGAR is conducting individual audits of implementing agencies capacity to provide oversight of the reconstruction funds that have been allocated to them. The first of these audits examine CSTC-A s contract oversight capability. The second is examining how USAID provides oversight of contracts for Afghanistan reconstruction. Auditors are reviewing USAID s current contract files as well as prior work done by the Government Accountability Office (GAO), the USAID Office of the Inspector General (USAID OIG), and the Commission on Wartime Contracting concerning USAID contract oversight and project requirement issues. Contractor Performance and Agency Oversight of U.S. Government Contracts in Afghanistan with Louis Berger Group SIGAR auditors are reviewing the contracts that U.S. agencies have with the Louis Berger Group. The audit, which is assessing the agencies oversight of the contractor as well as contractor performance, is scheduled for completion during the third quarter of U.S. and International Donor Programs To Assist Afghanistan s Energy Sector SIGAR has begun its program to assess the overall management and effectiveness of the U.S. and international effort in various reconstruction sectors. This audit, which is focusing on programs to rebuild Afghanistan s energy sector, seeks to identify U.S. and international goals for the reconstruction and sustainment of Afghanistan s energy sector. It will determine what performance metrics are being used to track and measure outcomes rather than outputs and examine the degree to which reconstruction programs in the energy sector support objectives established in the Afghanistan National Development Strategy (ANDS). SIGAR auditors are also assessing the coordination between U.S. and international agencies, and the degree to which Afghans have participated in the design and implementation of projects. This report will be completed during the next quarter. 16 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

25 SIGAR OVERSIGHT Controls and Accountability for the Commander s Emergency Response Program (CERP) SIGAR auditors are examining the management controls and procedures in place to ensure that the Commander s Emergency Response Program (CERP) funds are properly accounted for as well as used to support program objectives and mission strategies. Review of U.S. Assistance for the Preparation and Conduct of Presidential and Provincial Council Elections in Afghanistan SIGAR is conducting a multi-part evaluation of the election process in Afghanistan. In the first part, auditors are assessing the U.S. and international assistance provided for the presidential and provincial council elections scheduled to take place on August 20, SIGAR is examining the effectiveness of the programs to prepare for the elections in several areas, including voter registration, voter education, polling center security, ballot box integrity, and votecounting procedures. This audit will be released after the elections. As noted above, SIGAR believes an important part of its mission is to make the overall reconstruction program more effective. Therefore, SIGAR has already delivered a report to the U.S. Embassy both to provide information to implementing agencies and to allow them to make real-time adjustments to increase program effectiveness. After the elections, SIGAR will also issue a report assessing the participation of women in the electoral process. Later this year, SIGAR will issue an audit report that identifies lessons learned that may be applied to future elections. Review of Oversight and Anticorruption Capabilities and Performance of the Afghan Central Government; U.S. and Other Donor Efforts To Strengthen the Capabilities; and Funds That May Be at Risk Recognizing that corruption has become a very serious issue affecting the reconstruction effort, SIGAR is conducting an audit of U.S. and international assistance to the GIRoA at the national level, to establish internal controls and provide the accountability needed to combat corruption. This audit also will evaluate the ability of selected Afghan ministries to control and account for the flow of funds. It seeks to identify the funds at risk in certain ministries, assess the U.S. and international efforts to develop Afghan capacity to fight corruption, and provide recommendations to strengthen the internal controls and accounting mechanisms needed to ensure the effective and transparent management of government funds. SIGAR plans to publish a series of reports on this issue. The first will be released in the next quarter. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

26 SIGAR OVERSIGHT Review of Accountability and Anticorruption Capabilities and Performance of Afghan Provincial Governments; U.S. and Other Donor Efforts to Strengthen the Capabilities; and Funds That May Be at Risk Whereas the preceding audit is assessing the anticorruption assistance and capabilities in the central government, this audit is examining the capacity of Afghan officials at the provincial level to apply internal controls and account for funds under their control. SIGAR is evaluating both U.S. and international efforts to improve provincial government internal controls and accountability, which are critical to preventing corruption. It is also assessing options to strengthen the capacity at the provincial level to implement internal controls and other anticorruption measures. SIGAR plans to produce multiple reports, each one focusing on a province. The first report will be issued later this year. INSPECTIONS SIGAR issued one inspection report and initiated four inspections two of PRTs and two of infrastructure projects during this reporting period. The inspection of the Khowst City Power System identified several issues, including a high turnover of personnel involved in reconstruction projects that has resulted in a loss of institutional knowledge about projects, inadequate quality assurance and quality control measures, and insufficient training for Afghan operators to sustain projects. COMPLETED INSPECTIONS Improvements to the Khowst City Power System, SIGAR Inspections 09-1 The three new 500-kW generators at the Khowst Power Plant as they appeared during the SIGAR inspection visit on May 16, Of these three new generators, only two are operational; the third is awaiting replacement parts. (SIGAR photo) At the request of the Khowst provincial and city governments, the Khowst PRT initiated a $1.6 million project, funded by CERP, to improve the Khowst City Power System. The PRT divided the project into two contracts. The first contract, valued at $575,000, was to repair the existing power plant (Power Plant 1), build a second power plant (Power Plant 2), purchase and install three new 500-kW generators at Power Plant 1, and relocate an existing 400- kw generator to Power Plant 2. The second contract, valued at slightly more than $1 million, was to expand the underground electric grid within the city of Khowst. Collectively, the two projects were to add 1.5 MW to the local grid 18 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

27 SIGAR OVERSIGHT and provide increased access to power for the residents and businesses of Khowst. SIGAR conducted the inspection in May 2009 after a preliminary site visit earlier this year raised concerns about safety and sustainability issues at Power Plant 1. SIGAR found that the expansion of the electrical distribution system had been successfully completed in compliance with the second contract. However, SIGAR identified several issues relating to the first contract that needed to be addressed. These issues concern plant safety, quality assurance, and sustainability: The statements of work provided to the contractors did not include internationally accepted construction codes for the contractors to follow. The PRT did not include the installation of any safety equipment, such as that needed to fight fires, in the project s statement of work. The contractor did not fully comply with the terms of the contract, using sub-standard building materials in some areas. The PRT did not provide the quality assurance needed to ensure that the contractor met the technical requirements specified in the statement of work. A key mechanism needed to synchronize the newly installed generators failed shortly after the project was turned over to the Afghan authorities. Unable to repair the synchronizer mechanism, the plant operator bypassed it and wired two of the generators directly to the power distribution panel. As a result, two of the generators were running constantly and one of the newly installed generators was out of commission at the time of the inspection. The military s rotation schedule meant that the PRT experienced a complete turnover of its military personnel every nine months. During these rotations, the PRT claimed that some records and documents were lost. Consequently, SIGAR found the PRT had a limited institutional memory about this reconstruction project. SIGAR made the following recommendations and the PRT commander concurred with them. The PRT should: identify and correct the safety and technical deficiencies at the power plants assign qualified personnel to provide oversight of the follow-on CERP projects to correct the safety hazards and technical deficiencies of the Khowst Power System provide training and mentoring of local power plant management and personnel to build capacity so that long-term maintenance and sustainability of the Khowst Power System are addressed review its other CERP projects to determine whether it is providing adequate project oversight and adequate training and mentoring to build capacity for long-term project sustainment A 400-kV distribution panel as rewired by Afghan plant operators at Khowst Power Plant 1. (SIGAR photo) A rusted fuel tank resting on rocks is used as the fuel reservoir for Khowst City Power Plant 2 instead of the two new 6,000-liter fuel tanks that should have been installed in accordance with the project design. (SIGAR photo) REPORT TO THE UNITED STATES CONGRESS I JULY 30,

28 SIGAR OVERSIGHT The PRT commander concurred with SIGAR s findings and recommendations and said the PRT had procured additional CERP funding to address deficiencies in the Khowst City Power System. CURRENT INSPECTIONS Operations and Management Inspections of the Provincial Reconstruction Teams SIGAR has initiated a program of inspections of the management and operational capabilities in Afghanistan. The PRTs principal mission is to strengthen local governance and foster economic development; they play a key role in the international effort to stabilize Afghanistan. They also help coordinate the reconstruction effort in the provinces, not only between U.S. agencies but also with the international community and the local Afghan authorities. Of the 26 PRTs, 12 are led by the United States and 14 are led by other countries that are also part of the International Security Assistance Force (ISAF). SIGAR has conducted one PRT inspection and will issue a report during the next quarter. It has begun a second PRT inspection and plans to complete two others in These inspections seek to determine whether the PRT is: staffed at levels that allow it to conduct its mission staffed with inter-agency representation at appropriate levels of seniority and experience appropriately equipped, resourced, and trained to accomplish its mission coordinating reconstruction efforts with inter-agency partners, Afghan authorities, and other stakeholders executing the U.S. government s quality assurance program for projects for which the PRT is responsible creating and maintaining appropriate files and documentation for projects for which it is responsible complying with established guidelines, procedures, and policies required to ensure an effective handover and transfer of tasks to successive PRT staff Operations and Management Inspection of the Farah PRT SIGAR began its series of inspections of the operations and management of the PRTs throughout Afghanistan in Farah, a western province that borders Iran. SIGAR selected the Farah PRT for its first inspection because of its remote location and unique command-and-control relationship with ISAF. 20 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

29 SIGAR OVERSIGHT SIGAR sought to determine whether the PRT was adequately resourced and staffed to execute programs to improve security, foster good governance, and support economic development. The Farah PRT was created in late 2004 and became operational in early 2005 under direct U.S. military command. Italy, a coalition partner in ISAF, assumed responsibility for the Regional Command West in 2005 and took over operational control of the PRT at that time. Administrative control of the PRT, however, remained with the U.S. military. Farah is one of two U.S.-led PRTs that reports to a non-u.s. command. The Farah PRT, unlike other PRTs, also has been assigned a number of tasks not related to reconstruction. They include managing an isolated forward operating base (FOB) and local airfield, as well as administering a large area that houses numerous agencies and organizations that are not under the control of the PRT. Only 15% of the more than 600 residents on the base fall under the authority of the PRT commander. SIGAR will issue this report during the next quarter. Operations and Management Inspection of the Parwan-Kapisa PRT SIGAR has commenced an inspection of management aspects of the Parwan- Kapisa PRT, which is located at the Bagram Air Base. The report will be completed later this year. INFRASTRUCTURE INSPECTIONS While in Farah Province, SIGAR conducted two inspections of U.S.-funded infrastructure projects and will issue final reports during the next quarter. The first is a $1.75 million CERP project to build a bridge (the Tojg Bridge) across the Farah River at a crossing point about 37 miles southwest of the city of Farah. SIGAR is assessing whether the project, which began in September 2007 and is about 30% complete, is being built to contract specifications. The second inspection is of a joint project implemented by the Farah PRT and USAID to refurbish broadcast facilities to expand the coverage of Radio Television Afghanistan, the state-run media organization. The PRT used CERP funds to repair the facilities and USAID funds to rebuild the transmission towers. A complete report assessing whether the project fulfilled the terms of the contract, functions as intended, and is sustainable will be issued next quarter. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

30 SIGAR OVERSIGHT PLANNED INSPECTIONS SIGAR has notified USAID that it will inspect the $259 million Kabul Power Plant. This USAID-funded project was designed to build a power plant and switching station that could deliver 105 MW of power to the people of Kabul. USAID reports that it has obligated $237 million to date. The GIRoA has provided $20 million for this project. 11 SIGAR will review the documents used to establish the requirements for U.S. funding of the Kabul Power Plant, all relevant contracts, statements of work, and task orders, as well as the contractor s quality control records and the U.S. government s quality assurance records. SIGAR is planning two other infrastructure inspections, one of an ANP training center and the other of a hydroelectric power plant. THE SIGAR HOTLINE The SIGAR hotlines in Afghanistan and the United States received 30 calls reporting issues and complaints during this reporting period. SIGAR evaluates each call that concerns reconstruction activities in Afghanistan. Of these, SIGAR has referred three complaints to other agencies for investigation. SIGAR has launched a media campaign to inform people in Afghanistan about its hotline/complaints reporting service. SIGAR distributed about 1,500 posters in English, Dari, and Pashtu to Afghan government offices, international organizations, PRT commanders, and USFOR-A. Radio Free Afghanistan, the Armed Forces Network, and Voice of America ran public service announcements about the hotline in English, Dari, and Pashtu. In addition, the Inspector General discussed the hotline in his interviews with Afghan media during his recent trip to Afghanistan. 22 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

31 SIGAR OVERSIGHT INVESTIGATIONS During this reporting period, SIGAR initiated preliminary inquiries into 23 allegations of fraud, waste, and abuse related to Afghanistan reconstruction activities. The areas of inquiry include possible shipping fraud, weapons accountability, fuel procurements, and heavy-equipment leases. SIGAR investigators are also evaluating allegations of contractor misconduct, including false claims and overpayments. Remedies for resolving cases involving fraud, waste, and abuse include not only criminal and civil prosecution but also administrative actions (federal procurement contract remedies and suspensions/debarments). The Department of Justice (DoJ) has directed prosecutors to consider all remedies. SIGAR has met with the DoJ Civil Attorney and the Army s Procurement Fraud Branch to ensure civil remedies and suspension and debarment actions are considered and pursued to the maximum extent possible in appropriate cases. THE INTERNATIONAL CONTRACT CORRUPTION TASK FORCE (ICCTF) SIGAR investigators are working closely with the ICCTF, the principal organization coordinating federal cases that involve contract fraud and corruption related to U.S. government spending in Southwest Asia. As of June 30, 2009, the ICCTF had 25 open Afghanistan Procurement Fraud cases. Five of these were initiated in The ICCTF reports to the International Sub-Committee of DoJ s National Procurement Fraud Task Force. Other members of the ICCTF are: Federal Bureau of Investigation (FBI) DoD DCIS U.S. Army Criminal Investigation Command s (CID) Major Procurement Fraud Unit Naval Criminal Investigative Service (NCIS) Air Force Office of Special Investigations (AFOSI) DoS, Office of the Inspector General (DoS OIG) USAID OIG Special Inspector General for Iraq Reconstruction (SIGIR) In Afghanistan, the ICCTF has offices in Kabul, Bagram, and Kandahar. Each member of the ICCTF deploys agents to these combined offices to work jointly on investigations in Afghanistan. In addition to doing casework, the REPORT TO THE UNITED STATES CONGRESS I JULY 30,

32 SIGAR OVERSIGHT agents are also conducting fraud awareness briefings and risk assessments. The ICCTF enables the investigative agencies to share their respective expertise, leverage their resources, and minimize duplication of effort, not only in Afghanistan but throughout the world. During this reporting period, SIGAR worked with colleagues in the ICCTF on cases involving fraud and corruption. These cases are at various stages of investigation and prosecution. For example: In cooperation with military authorities, SIGAR investigated allegations that an active-duty soldier had accepted bribes for directing reconstruction contracts. This case has been referred to the Army Staff Judge Advocate. A courts martial prosecution under the Uniform Code of Military Justice may result. SIGAR is reviewing complaints concerning an Afghan government official allegedly involved in influence-peddling. Afghanistan reconstruction cases currently being prosecuted include: Two DoD contractors and their company were charged variously with bribery and conspiracy related to U.S. Army Corps of Engineers contracts. The case is being investigated by the ICCTF and prosecuted by DoJ s Antitrust Division. The indictment was filed on May 6, Trial is scheduled for September DoJ s Criminal Division Fraud Section is prosecuting a case emanating from the Rehabilitation of Economic Facilities Program, in which a security contractor is charged with submitting inflated expenses to the prime contractor which, ultimately, were submitted to the U.S. government. USAID is the lead investigative agency. Trial is set for September SIGAR BUDGET The Supplemental Appropriation for FY 2009 (P.L ), signed by the U.S. president in June, provided $7.2 million to SIGAR over two years to address the organization s budget shortfall. SIGAR had submitted a request for this amount to the Office of Management and Budget to be included in the supplemental appropriation. With the additional funding, SIGAR s budget for FY 2009 totals $23.2 million. The supplemental funding allows SIGAR to hire an additional 25 full-time equivalents (FTEs) as well as locally employed staff (interpreters). This staff is critical to SIGAR s mission to conduct independent audits, inspections, and investigations of the reconstruction program in Afghanistan. See Table 2.1 for a SIGAR funding summary. 24 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

33 SIGAR OVERSIGHT SIGAR STAFF Since its last quarterly report to Congress, SIGAR has significantly enhanced its capacity to conduct oversight, increasing the number of federal employees on its staff from 32 to SIGAR expects to hire an additional three auditors, one inspector, two investigators, and one information technology manager by the end of August TABLE 2.1 SIGAR FUNDING SUMMARY ($ MILLIONS) Appropriation Public Law Appropriated Made Available Expires Amount Supplemental Appropriations for Fiscal P.L /30/2008 6/30/2008 9/30/2009 $2.0 Year 2008, HR2642 Supplemental Appropriations for Fiscal P.L /30/ /1/2008 9/30/2009 $5.0 Year 2008, HR2642 Consolidated Security, Disaster Assistance, P.L /30/2008 9/30/2008 9/30/2010 $9.0 and Continuing Appropriations Act, 2009 Supplemental Appropriations for Fiscal Year 2009, HR2346 P.L /24/2009 6/24/2009 9/30/2010 $7.2 TOTAL $23.2 REPORT TO THE UNITED STATES CONGRESS I JULY 30,

34 Kunar Construction Center Graduates Graduates of the Kunar Construction Center (funded jointly by USAID and CERP) in eastern Afghanistan received formal vocational training in carpentry, masonry, electrical work, and painting. (USAID photo)

35 3 RECONSTRUCTION UPDATE 27

36 As an Afghan-owned blueprint for the development of Afghanistan in all spheres of human endeavor, the ANDS will serve as our nation s roadmap for the long-desired objective of Afghanization, as we transition towards less reliance on aid and an increase in self-sustaining economic growth. Afghan President Hamid Karzai, describing the Afghanistan National Development Strategy SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

37 RECONSTRUCTION UPDATE RECONSTRUCTION UPDATE Since 2002, the United States has provided over $38 billion for the reconstruction of Afghanistan. Two strategies the Afghanistan National Development Strategy (ANDS) and the new U.S. strategy for Afghanistan provide the framework for the U.S. reconstruction effort. The ANDS, developed in consultation with the international community, establishes benchmarks under three reconstruction pillars: security; governance, rule of law, and human rights; and economic and social development. In addition, the ANDS identifies six issues regional cooperation, counter-narcotics, anticorruption, gender equality, capacity development, and environment that cut across all three pillars. The Government of the Islamic Republic of Afghanistan (GIRoA) adopted the ANDS in 2008, and the United States is committed to helping Afghanistan achieve the ANDS objectives. This section provides an update on the status of U.S. and international funding for the reconstruction of Afghanistan, as well as an update on reconstruction efforts made under each of the three pillars. The sub-section on funding examines how funds set aside for reconstruction have been apportioned among U.S. implementing agencies then describes activities under each of the three pillars of The construction of Jurm School, a USAID-funded school construction project, has created jobs for Afghan men. (USAID photo, Ben Barber) REPORT TO THE UNITED STATES CONGRESS I JULY 30,

38 RECONSTRUCTION UPDATE the ANDS. The sub-section on security focuses on U.S. efforts to train the Afghan National Security Forces (ANSF). The sub-section on governance, rule of law, and human rights sets the stage for the upcoming presidential and provincial council elections and describes anticorruption efforts. The last sub-section, which describes the activities undertaken to promote economic and social development, includes an update on counter-narcotic efforts. The information presented in this section incorporates U.S. government agencies data and information, official reports, congressional testimony, and other public sources. SIGAR has not independently verified the data. All sources are identified in the endnotes. THE AFGHANISTAN NATIONAL DEVELOPMENT STRATEGY (ANDS) GIRoA adopted the ANDS in 2008, after two years of consultations with a broad range of Afghans as well as with the international community. Building on the 2006 Afghanistan Compact, the ANDS describes reconstruction objectives under three pillars security; governance, rule of law, and human rights; and economic and social development and establishes benchmarks for achieving the goals. It also identifies six cross-cutting issues regional cooperation, counter-narcotics, anticorruption, gender equality, capacity building, and environmental management that need to be addressed as part of the overall development strategy. The ANDS establishes priorities for five years ( ) in the three pillars, described below. Figure 3.1 will be used to highlight the pillars and cross-cutting issues throughout this section. Security The primary goal is to stabilize, with the help of the International Security Assistance Force (ISAF), all regions of the country and increase the capability of the ANSF to provide for Afghanistan s security by This includes expanding the ANSF the Afghan National Army (ANA) and Afghan National Police (ANP) and ensuring that they represent and are accountable to the people of Afghanistan. In addition, the GIRoA seeks to strengthen its law-enforcement capacity at both the central and provincial levels, increase its coordination and intelligencesharing with neighbors to reduce narcotic trafficking, and clear 70% of the area contaminated by land mines and unexploded ordnance. Governance, Rule of Law, and Human Rights The ANDS emphasizes strengthening government institutions at the central and sub-national levels to improve the delivery of public services and protect the rights of all citizens. The long list of goals in this pillar includes reforming the 30 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

39 RECONSTRUCTION UPDATE justice sector and restructuring the civil service to ensure a fiscally sustainable public administration. It also puts a high priority on developing the capacity of the Afghanistan Independent Electoral Commission (IEC) to conduct elections, implementing a national plan to expand female participation in governance, reforming oversight procedures to prevent corruption, and repairing courts and prisons. Economic and Social Development The ANDS goal is to reduce poverty by expanding the private sector while progressively eliminating the criminal economy. Private sector growth depends on expanding the country s infrastructure in the critical areas of electricity, transportation, and water management. At the same time, the ANDS calls for training and education programs to build capacity in both the public and private sectors. FIGURE 3.1 AFGHANISTAN NATIONAL DEVELOPMENT STRATEGY (ANDS) REGIONAL COOPERATION COUNTER-NARCOTICS SECURITY GOVERNANCE DEVELOPMENT Graphic Symbol: The graphic below represents the three pillars of the ANDS and the six cross-cutting issues affecting them. Throughout this section, the pillar or cross-cutting issue under discussion is highlighted in the margins. ANTICORRUPTION GENDER EQUALITY REGIONAL COOPERATION COUNTER-NARCOTICS DEVELOPMENT GOVERNANCE SECURITY ANTICORRUPTION CAPACITY GENDER EQUALITY CAPACITY ENVIRONMENTAL ENVIRONMENTAL REPORT TO THE UNITED STATES CONGRESS I JULY 30,

40 The ability to implement the projects and programs included in the ANDS depends upon the resources that will be available. Afghanistan National Development Strategy 32 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

41 STATUS OF FUNDS STATUS OF FUNDS On June 24, 2009, the President of the United States signed the FY 2009 Supplemental Appropriations Act, providing an additional $5.04 billion for the reconstruction of Afghanistan, including $3.6 billion for the Afghan security forces. 14 Including this recent appropriation, the United States has provided approximately $38 billion in relief and reconstruction assistance to Afghanistan. U.S. RECONSTRUCTION FUNDING FOR AFGHANISTAN Since the United States and its partners overthrew the Taliban in 2001, the U.S. Congress has passed several major appropriation bills to finance efforts to rebuild Afghanistan. The Office of Management and Budget (OMB) has apportioned the money to several agencies that are responsible for implementing U.S. reconstruction efforts in Afghanistan. Figure 3.2 provides an overview of the major U.S. funds contributing to Afghanistan reconstruction efforts. FIGURE 3.2 U.S. FUNDS SUPPORTING AFGHANISTAN RECONSTRUCTION EFFORTS ($ BILLIONS) FUNDING SOURCES (TOTAL: $38.07) ASFF CERP ESF DA INCLE Other Supp. $15.06 $1.62 $7.63 $0.89 $1.99 $5.84 $5.04 AGENCIES Department of Defense (DoD) $16.68 USAID $8.52 Department of State (DoS) $1.99 Distributed to Multiple Agencies a Awaiting Apportionment b Security International Training Organizations Afghan National Army (ANA) Afghan National Police (ANP) AFGHANISTAN NATIONAL DEVELOPMENT STRATEGY (ANDS) Governance Elections Human Rights Judicial Reform and Prosecution Rule of Law Anticorruption Development Essential Services Agriculture Industry Growth Banking Provincial Reconstruction Teams (PRTs) Note: Numbers affected by rounding. a DoJ, DoD, DoS, U.S. Treasury, USDA, USAID, and other agencies. b Supplemental passed as of 6/24/2009. Sources: DoD, responses to SIGAR data call, 7/10/2009 and 7/13/2009. USAID, response to SIGAR data call, 7/9/2009. DoS, response to SIGAR data call, 7/2/2009. DoJ/DEA, response to SIGAR data call, 7/8/2009. DoS, responses to SIGAR data call, 7/10/2009 and 7/13/2009. USDA, response to SIGAR data call, 4/7/2009. OMB, responses to SIGAR data call, 9/30/2008 and 7/16/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

42 STATUS OF FUNDS Graphic Symbol: This report deals with many funds and projects ranging from millions to billions of dollars. To provide an accurate graphical representation of these numbers, some bar graphs appear with a break (a wavy line) to indicate a jump between zero and a higher number. Afghanistan Security Forces Fund (ASFF): $15.06 billion 15 Administered by the Department of Defense (DoD), the ASFF provides support for the training and equipping of the Afghan National Security Forces (ANSF). 16 Commander s Emergency Response Program (CERP): $1.62 billion 17 Administered by DoD, CERP funds enable local U.S. commanders in Afghanistan (and Iraq) to support programs and projects that provide assistance at a local level. 18 Economic Support Fund (ESF): $7.63 billion 19 Administered by the U.S. Agency for International Development (USAID), the ESF provides the largest amount of U.S. assistance for democracy and capacitybuilding programs in Afghanistan. 20 Development Assistance (DA): $0.89 billion 21 Managed by USAID, DA programs support economic progress and social stability in developing countries. 22 International Narcotics Control and Law Enforcement Fund (INCLE): $1.99 billion 23 Managed by the Department of State (DoS) Bureau of International Narcotics and Law Enforcement (INL), INCLE and other INL-managed funds focus primarily on supporting law enforcement and counter-narcotics programs. 24 Other Funding: $5.84 billion 25 Additional reconstruction funding is managed by DoD, DoS (including INL), USAID, and the Department of Justice (DoJ) Drug Enforcement Agency (DEA). 26 $4,100 $4,050 $0 Graphic Symbol: Because this report details funding in both millions and billions of dollars, it uses a visual cue to distinguish the two units. Dollars reported in millions are represented in brown, and dollars reported in billions are depicted in blue. Pie chart in Millions Pie chart in Billions 34 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

43 STATUS OF FUNDS AFGHANISTAN SECURITY FORCES FUND (ASFF) The DoD Combined Security Transition Command-Afghanistan (CSTC-A) uses Afghanistan Security Forces Fund monies to provide the Afghan National Security Forces (ANSF) with equipment, training, sustainment, counter-insurgency, and infrastructure development. 27 Status of Funds As of June 30, 2009, nearly all of the $15.06 billion in funds made available for the ASFF have been obligated ($14.90 billion). Approximately $14.69 billion (more than 97% of funds available for the ASFF) has been disbursed. 28 Figure 3.3 depicts funds made available to the ASFF by fiscal year. Since February 28, 2009, DoD has disbursed more than $1.93 billion in ASFF monies, and obligated an additional $2.07 billion. 29 Figure 3.4 compares the status of funds for the second quarter (as of February 28, 2009) to the status of funds for the third quarter (as of June 30, 2009). ASFF Budget Activities The ASFF is divided into three budget activities: defense forces, interior forces, and related activities. 30 As shown in Figure 3.5, a majority of the ASFF funds have been disbursed for defense forces, specifically for sustainment, infrastructure, training and operations, and equipment and transportation activities for the Afghan National Army (ANA). Similarly, the ASFF monies disbursed for interior forces support the same activity groups for the Afghan National Police (ANP). 31 ASFF DoD ASFF FUND TERMINOLOGY DoD reported ASFF funds as available, obligated, or disbursed. 32 Available: Total monies available for commitments Obligations: Commitments to pay monies Disbursements: Monies that have been expended FIGURE 3.5 ASFF DISBURSEMENTS BY BUDGET ACTIVITY, FY ($ BILLIONS) Total: $14.69 FIGURE 3.3 FIGURE 3.4 ASFF AVAILABLE FUNDS BY FISCAL YEAR ($ BILLIONS) $8.0 $6.0 ASFF FUNDS, PERIOD TO PERIOD COMPARISON ($ BILLIONS) $15.0 $14.0 Available $15.06 Available $15.06 Obligated $14.90 Disbursed $14.69 Defense Forces $9.35 Interior Forces $5.28 Related Activities $0.07 $4.0 $2.0 $13.0 $12.0 Obligated $12.83 Disbursed $12.76 Notes: Numbers affected by rounding and are as of 6/30/2009. ASFF funding terms (available, obligated, disbursed) reported as provided by DoD except as specified. Source: DoD, response to SIGAR data call, 7/10/2009. $ $0 As of Feb 28, 2009 As of June 30, 2009 Notes: Numbers affected by rounding. ASFF funding terms (available, obligated, disbursed) reported as provided by DoD except as specified. Source: DoD, response to SIGAR data call, 7/10/2009. Notes: Data may include inter-agency transfers. Numbers affected by rounding. ASFF funding terms (available, obligated, disbursed) reported as provided by DoD except as specified. Sources: DoD, responses to SIGAR data call, 2/28/2009 and 7/10/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

44 STATUS OF FUNDS DoD CERP CERP FUND TERMINOLOGY DoD reported CERP funds as funded, obligated, or disbursed. 33 Funding: Total monies available for commitments Obligations: Commitments to pay monies Disbursements: Monies that have been expended COMMANDER S EMERGENCY RESPONSE PROGRAM (CERP) CERP funds enable U.S. commanders in Afghanistan to respond to urgent humanitarian relief and reconstruction requirements in their areas of responsibility by supporting programs that will immediately assist the local population. CERP is intended to be used for small-scale projects under $500,000 per project. Projects over $2 million are permitted, but require approval from commanders, U.S. Central Command (CENTCOM), or their designees. 34 Status of Funds Since FY 2004, CENTCOM 35 has funded nearly $1.62 billion for CERP in Afghanistan, including almost $0.54 billion in FY As of June 30, 2009, approximately $1.45 billion in CERP funding has been obligated, and nearly $0.81 billion (50% of funded amounts) has been disbursed. 36 Figure 3.6 depicts CERP funding by fiscal year. This quarter (between April 1, 2009, and June 30, 2009), DoD disbursed nearly $0.13 billion in CERP funds and obligated almost $0.21 billion. 37 Figure 3.7 compares CERP funded, obligated, and disbursed funds for the second quarter (as of March 31, 2009) and the third quarter (as of June 30, 2009). FIGURE 3.6 CERP FUNDING BY FISCAL YEAR ($ MILLIONS) FIGURE 3.7 CERP FUNDS, PERIOD-TO-PERIOD COMPARISON ($ BILLIONS) $600 $500 $1.6 $1.5 $1.4 Funded $1.44 Funded $1.62 Obligated $1.45 $400 $1.3 $1.2 Obligated $1.25 $300 $1.1 $1.0 $200 $0.9 $0.8 Disbursed $0.81 $100 $0.7 Disbursed $0.68 $ $0 As of Mar 31, 2009 As of June 30, 2009 Notes: Data may include inter-agency transfers. Numbers affected by rounding. CERP funding terms (funded, obligated, disbursed) reported as provided by DoD except as specified. Source: DoD, response to SIGAR data call, 7/13/2009. Notes: Numbers affected by rounding. CERP funding terms (funded, obligated, disbursed) reported as provided by DoD except as specified. Sources: DoD, responses to SIGAR data call, 7/13/2009 and 7/14/ SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

45 STATUS OF FUNDS ECONOMIC SUPPORT FUND (ESF) ESF programs advance U.S. interests by helping countries meet short- and longterm political, economic, and security needs. Programs range from supporting counter-terrorism to bolstering a nation s private sector, to assisting in the development of effective, accessible, independent legal systems for a more transparent and accountable government. 38 Status of Funds Since 2002, the Congress has appropriated approximately $7.57 billion to ESF programs for Afghanistan. Of this amount, approximately $6.09 billion has been obligated and $4.17 billion disbursed (nearly 55% of the appropriated amount). 39 Figure 3.8 shows ESF appropriations by fiscal year. Since February 28, 2009, USAID has disbursed approximately $454 million and obligated more than $88 million. 40 Figure 3.9 depicts appropriations, obligations, and disbursements for ESF. ESF USAID ESF FUND TERMINOLOGY USAID reported ESF funds as appropriated, obligated, or disbursed. 41 Appropriations: Total monies available for commitments Obligations: Commitments to pay monies Disbursements: Monies that have been expended FIGURE 3.8 ESF APPROPRIATIONS BY FISCAL YEAR ($ BILLIONS) FIGURE 3.9 ESF FUNDS, PERIOD-TO-PERIOD COMPARISON ($ BILLIONS) $2.5 $7.0 Appropriated $7.57 Appropriated $7.57 $2.0 $6.0 Obligated $6.00 Obligated $6.09 $1.5 $5.0 $1.0 $0.5 $4.0 Disbursed $3.72 Disbursed $4.17 $ $0 As of Feb 28, 2009 As of June 30, 2009 Notes: Data may include inter-agency transfers. Numbers affected by rounding. ESF funding terms (appropriated, obligated, disbursed) reported as provided by USAID except as specified. Source: USAID, response to SIGAR data call, 7/9/2009. Notes: Data may include inter-agency transfers. Numbers affected by rounding. EFF funding terms (appropriated, obligated, disbursed) reported as provided by USAID except as specified. Sources: USAID, responses to SIGAR data call, 2/28/2009 and 7/10/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

46 STATUS OF FUNDS USAID DA DA FUND TERMINOLOGY USAID reported DA funds as appropriated, obligated, or disbursed. 42 Appropriations: Total monies available for commitments Obligations: Commitments to pay monies Disbursements: Monies that have been expended DEVELOPMENT ASSISTANCE (DA) Primarily managed by USAID, DA programs are designed to advance sustainable, broad-based economic progress and social stability in developing countries, including Afghanistan. 43 DA funds finance long-term projects to provide humanitarian assistance, address environmental issues, improve governance, and promote socioeconomic development. 44 Status of Funds As of June 30, 2009, approximately $890 million in DA funds has been provided for Afghanistan. 45 USAID has obligated nearly $883 million of these funds. 46 Of this amount, almost $674 million (nearly 76% of DA funds) has been disbursed. 47 Figure 3.10 shows DA appropriations by fiscal year. Since February 28, 2009, USAID has disbursed more than $44 million in DA funds for Afghanistan and obligated almost $8.6 million. 48 USAID has reported that 2008 disbursements were affected by delayed receipt of funds; the majority of funds were not released to USAID until late August and mid-september. 49 Figure 3.11 depicts appropriated, obligated, and disbursed DA funds. FIGURE 3.10 DA APPROPRIATIONS BY FISCAL YEAR ($ MILLIONS) FIGURE 3.11 DA FUNDS, PERIOD TO PERIOD COMPARISON ($ MILLIONS) $200 Appropriated $ Appropriated $ $150 $850 Obligated $ Obligated $ $800 $100 $750 $50 $700 $650 Disbursed $ Disbursed $ $ $0 As of Feb 28, 2009 As of June 30, 2009 Notes: Data may include inter-agency transfers. Numbers affected by rounding. DA funding terms (appropriated, obligated, disbursed) reported as provided by USAID except as specified. Source: USAID, response to SIGAR data call, 7/9/2009. Notes: Numbers affected by rounding. ESF funding terms (appropriated, obligated, disbursed) reported as provided by USAID except as specified. Source: USAID, response to SIGAR data call, 7/9/ SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

47 STATUS OF FUNDS BUREAU OF INTERNATIONAL NARCOTICS CONTROL AND LAW ENFORCEMENT AFFAIRS (INL) INL is a branch of DoS responsible for overseeing projects and programs designed to combat narcotics trafficking and drug production. INL manages INCLE, which supports rule of law and interdiction; poppy eradication and demand reduction; and public information. INL also receives funding from other agencies, primarily DoD, to support counter-narcotics programs in Afghanistan. 50 Status of Funds As of June 30, 2009, approximately $3.11 billion was allotted for INL programs in Afghanistan. Of this amount, INL obligated approximately $2.88 billion and liquidated $2.10 billion (more than 67% of funds allotted). 51 Figure 3.12 shows INL allotments by fiscal year. Since March 10, 2009, INL was allotted an additional $270 million. During the same period, INL obligated more than $368 million and liquidated more than $295 million. 52 Figure 3.13 shows allotted, obligated, and liquidated INL funds (including INCLE) for the second quarter (as of March 10, 2009) and the third quarter (as of June 30, 2009). INL FUND TERMINOLOGY INCLE DoS INL reported INCLE and other INL funds as allotted, obligated, or liquidated. 53 Allotments: Total monies available for commitments Obligations: Commitments to pay monies Liquidations: Monies that have been expended FIGURE 3.12 INL ALLOTMENTS BY FISCAL YEAR ($ MILLIONS) FIGURE 3.13 INL FUNDS, PERIOD TO PERIOD COMPARISON ($ BILLIONS) $800 $700 $600 $500 $3.00 $2.75 $2.50 Allotted $2.84 Obligated $2.51 Allotted $3.11 Obligated $2.88 $400 $300 $200 $2.25 $2.00 $1.75 Liquidated $1.80 Liquidated $2.10 $100 $ $0 As of Mar 10, 2009 As of June 30, 2009 Notes: Data may include inter-agency transfers. Numbers affected by rounding. INL funding terms (allotted, obligated, liquidated) reported as provided by DoS and INL except as specified. Sources: DoS, responses to SIGAR data call, 7/2/2009 and 7/15/2009. Notes: Numbers affected by rounding. INL funding terms (allotted, obligated, liquidated) reported as provided by DoS and INL except as specified. Sources: DoS, responses to SIGAR data call, 7/2/2009 and 7/15/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

48 STATUS OF FUNDS INL Programs INL funds are divided into several program groups: police, counter-narcotics, rule of law/justice, and other programs. Police programs have the largest amount of liquidations ($1,178 million or 56% of liquidations), followed by counter-narcotics programs ($769 million or nearly 37% of liquidations). 54 Figure 3.14 shows liquidations by program for INL (including INCLE). INCLE The majority of INCLE funds are used to support police, counter-narcotics, and rule of law and justice programs. As of June 30, 2009, approximately $1.99 billion has been allotted to INCLE, almost $1.78 billion has been obligated and nearly $1.48 billion has been liquidated. 55 Figure 3.15 depicts INCLE allotments, obligations, and liquidations for the second quarter (as of March 10, 2009) and for the third quarter (as of June 30, 2009). FIGURE 3.14 FIGURE 3.15 TOTAL INL LIQUIDATIONS BY PROGRAM, FY ($ MILLIONS) INCLE FUNDS, PERIOD TO PERIOD COMPARISON ($ BILLIONS) Total: $2, $2.0 Allotted $1.99 Obligated $1.66 Allotted $1.99 Obligated $1.78 Counternarcotics $ Police $1, $1.5 $1.0 Liquidated $1.27 Liquidated $1.48 Other $32.23 Rule of Law/Justice $ $0.5 Notes: Data may include inter-agency transfers. Numbers affected by rounding. INL funding terms (allotted, obligated, liquidated) reported as provided by DoS and INL except as specified. Source: DoS, response to SIGAR data call, 7/14/2009. $0 As of Mar 10, 2009 As of June 30, 2009 Notes: Data may include inter-agency transfers. Numbers affected by rounding. INL funding terms (allotted, obligated, liquidated) reported as provided by DoS and INL except as specified. Sources: DoS, responses to SIGAR data call, 3/19/2009 and 7/10/ SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

49 STATUS OF FUNDS GOVERNMENT OF AFGHANISTAN FUNDS The Government of the Islamic Republic of Afghanistan (GIRoA) also provides funds for reconstruction efforts, in addition to its operating expenses. The GIRoA Ministry of Finance (MOF) is responsible for the management and execution of the budget, which includes Afghan funds for reconstruction efforts. 56 MOF also is accountable for international funds when they are routed through government ministries. USAID reported that the GIRoA faces challenges in its financial management, particularly anticorruption performance, procurement systems, and budget execution rates. 57 Domestic Budget and Budget Execution The GIRoA budget for is an estimated $7.3 billion. The budget is broken into two categories: the $2.4 billion core budget (including operating and development budgets) and the $4.9 billion external budget. 58 Figure 3.16 provides a breakdown of GIRoA budget amounts. Core Budget - Operating The GIRoA has provided $1.4 billion for its operating budget, composed primarily of recurrent costs, such as government salaries. Budget execution for this section of the GIRoA budget has reached 100%. 59 Core Budget - Development The GIRoA also budgeted $1 billion for development in the areas of governance, infrastructure, agriculture, economic reform, and private sector development. The GIRoA currently executes approximately 50% of its development budget each year. According to the U.S. Treasury (Treasury), the GIRoA has trouble executing its development budget because of low capacity in the ministries and continuing security challenges. 60 External Budget For FY 2009, Afghanistan s external budget was approximately $4.9 billion. The GIRoA s external budget is composed primarily of security expenses, though some development funding is included. Afghanistan s entire external budget is dependent on international assistance. 61 Domestic Revenue For , Treasury reported Afghanistan s revenue as approximately $978 million nearly 41% of its $2.4 billion core budget. 62 Figure 3.17 depicts the sources of domestic revenue for the GIRoA. Treasury reported that the GIRoA relies on external revenue to fund almost 60% of its core budget, plus its entire external budget. 63 FIGURE 3.16 GIRoA BUDGET, ($ BILLIONS) Core Budget Development $1.0 Total: $7.3 External Budget $4.9 Core Budget Operating $1.4 Note: Numbers affected by rounding. Source: U.S. Treasury, response to SIGAR data call, 7/9/2009. FIGURE 3.17 GIRoA DOMESTIC REVENUE, ($ MILLIONS) Tax Revenue $ Total: $ Customs Revenue $ Non-tax Revenue $ Note: Numbers affected by rounding. Source: U.S. Treasury, response to SIGAR data call, 7/9/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

50 STATUS OF FUNDS Blocked Funds During Taliban rule (prior to December 31, 2001), $264 million was blocked or frozen in U.S. bank accounts pursuant to sanctions against the Taliban; this represents the valuation of 703,000 ounces of gold held by the Central Bank of Afghanistan with the U.S. Federal Reserve, according to Treasury. Following the U.S.-led military campaign, the Afghan Interim Authority established control over Afghanistan. The United States returned blocked Taliban assets to the Afghan Interim Authority between February and April Treasury reported that funds were not vested by the U.S. government. 64 INTERNATIONAL DONORS At the Paris Conference in June 2008, Afghanistan presented the ANDS and requested $50.1 billion over five years to support the ANDS initiatives. The $50.1 billion included $14 billion to improve infrastructure, $14 billion to build the ANSF, $4.5 billion for agriculture and rural development, and additional funding for other programs. 65 The international community pledged approximately $21 billion, less than half of the requested amount. The donors cited a relative lack of transparency in the GIRoA as the main reason for lower donations. 66 According to Treasury, the $21 billion international pledge represents a significant sum considering the GIRoA s capacity to absorb funding and execute projects. Treasury recommends an increased focus on effective and efficient expenditure of the money currently pledged to Afghanistan before further funding is solicited. 67 Afghanistan Reconstruction Trust Fund In addition to Paris Conference pledges, the international community contributes monies to international institutions and trust funds that manage reconstruction programs in Afghanistan. 68 For example, the World Bank manages the Afghanistan Reconstruction Trust Fund (ARTF). Between March 22, 2008, and March 21, 2009, 19 international countries pledged $627 million to Afghanistan reconstruction efforts through the fund; a similar amount was pledged between March 22, 2007, and March 21, Since its inception in 2002, international donors have contributed approximately $3 billion to the ARTF. 69 Table 3.1 depicts funding pledges to the ARTF between March 22, 2008, and March 21, SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

51 STATUS OF FUNDS TABLE 3.1 CONTRIBUTIONS TO THE ARTF (MARCH 22, 2008 MARCH 21, 2009) ($ MILLIONS) Main Contributors Total Pledges Paid Funds as of May 2009 United States $ $1.50 United Kingdom $ $0.00 Netherlands $50.15 $0.00 Canada $45.69 $16.34 Norway $43.30 $11.32 Germany $34.47 $0.00 Spain $34.47 $0.00 Sweden $17.11 $0.00 European Commission/European Union $16.81 $0.00 Australia $14.99 $14.99 Others $17.45 $0.00 Total $ $44.15 Source: World Bank, ARTF: Administrator s Report on Financial Status, 5/21/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

52 STATUS OF FUNDS Security in all parts of the country is essential for effective governance, private sector development, economic growth, poverty reduction, and the safeguarding of individual liberty. Afghanistan National Development Strategy 44 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

53 SECURITY SECURITY FUNDING SUMMARY The U.S. Department of Defense (DoD) reported that of the $15.06 billion available for the Afghanistan Security Forces Fund (ASFF) between FY 2005 and June 30, 2009, $11.08 billion has been made available for training and operations, infrastructure, and equipment and transportation for the Afghan National Security Forces (ANSF), which comprises the Afghan National Army (ANA) and the Afghan National Police (ANP). 70 This sum represents roughly 33.6% of the $33.03 billion in U.S. reconstruction funds made available for Afghanistan. 71 During the same period, $11.01 billion has been obligated and $10.88 billion has been disbursed for the ANSF. More than 49% was disbursed for equipment and transportation, while the remaining available funds were split, with 30.2% going to infrastructure and 20.6% going to training and operations. 72 See Figure 3.18 for details on the status of ASFF funds for ANSF training and operations, infrastructure, and equipment and transportation. DoD-Funded Contracts DoD reported that a total of $1.91 billion has been expended during the period from January 1 through June 30, 2009, against $4.28 billion obligated under active U.S.- funded contracts in Afghanistan. 73 These contracts funded projects including construction, foreign military sales, operation and maintenance, the ANA, and the ANP. See Figure 3.19 for additional details on contract obligations and expenditures. AFGHANISTAN NATIONAL DEVELOPMENT STRATEGY (ANDS) REGIONAL COOPERATION COUNTER-NARCOTICS ANTICORRUPTION GENDER EQUALITY CAPACITY ENVIRONMENTAL FIGURE 3.19 DEVELOPMENT GOVERNANCE SECURITY CSTC-A CONTRACT OBLIGATIONS AND EXPENDITURES, JANUARY 1 JUNE 30, 2009 ($ MILLIONS) Total Obligations: $4, FIGURE 3.18 STATUS OF ASFF FUNDS FOR ANSF TRAINING AND OPERATIONS, INFRASTRUCTURE, AND EQUIPMENT AND TRANSPORTATION, FY ($ BILLIONS) $11.0 $10.9 $10.8 $0 Available $11.08 Obligated $11.01 Disbursed $10.88 Equipment and Transportation $5.35 Disbursed: $10.88 Infrastructure $3.28 Training and Operations $2.24 Unexpended $2, Expended $1, Notes: Numbers affected by rounding. Unexpended obligations may include unreported expenditures. Source: CSTC-A, response to SIGAR data call, 7/1/2009. Notes: Numbers affected by rounding and are as of June 30, ASFF funding terms (available, obligated, disbursed) reported as provided by DoD except as specified. Source: DoD, response to SIGAR data call, 7/10/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

54 SECURITY Programs Approximately $1.94 billion in contract awards has been obligated for the ANA. Of this amount, $ million has been obligated for ANA operations and maintenance programs. The ANA received approximately 45.4% of the total reported contract obligations. In comparison, $1.42 billion in contract awards has been obligated for the ANP, representing 33% of total reported contract obligations. 75 See Figure 3.20 for additional details on contract obligations by program. There can be no government without an army, no army without money, no money without prosperity, and no prosperity without justice and good administration. Contract Types Approximately $1.47 billion in contract awards has been obligated for construction contracts, representing 34.4% of total reported contract awards. The next largest category, not including Additional Program Obligations, was foreign military sales, which accounted for $ million, or 9.8%, of the total reported contract awards. See Figure 3.21 for additional details on contract obligations by contract type. 76 TRAINING THE ANSF Security is a prerequisite for stability and development in Afghanistan. Training the ANSF to provide this security is a top priority for the United States. 77 This section focuses on the U.S. efforts to train and equip the ANSF. Ibn Qutayba, notable 9th-century Islamic scholar, reflecting on the importance of security to the prosperity and development of a country 74 FIGURE 3.20 CSTC-A CONTRACT OBLIGATIONS BY PROGRAM, JANUARY 1 JUNE 30, 2009 ($ MILLIONS) Total: $4, FIGURE 3.21 CSTC-A CONTRACT OBLIGATIONS BY CONTRACT TYPE, JANUARY 1 JUNE 30, 2009 ($ MILLIONS) Total $4, ANA $1, ANP $1, ANA-Operations and Maintenance $ Additional Contract Obligations $2, Construction $1, Additional Program Obligations $ Local $ Foreign Military Sales $ Operations and Maintenance $ Notes: Numbers affected by rounding. Additional Program Obligations represents obligations for 1-story and 2-story programs and obligations for which a program type was not provided. Source: CSTC-A, response to SIGAR data call, 7/1/2009. Notes: Numbers affected by rounding. Contract type represents the data call category Fund Type/Type Contract. O&M includes FMS, O&M and O&M OBAN GWOT. Additional contract obligations represents obligations for which a contract type was not provided. Source: CSTC-A, response to SIGAR data call, 7/1/ SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

55 SECURITY Background In December 2001, participants at the United Nations (UN) Talks on Afghanistan (the Bonn Conference) committed to helping the Government of the Islamic Republic of Afghanistan (GIRoA) establish and train a new Afghan security force. 78 In early 2006, the GIRoA and the international community met during the London Conference on Afghanistan and agreed to continue the efforts of the North Atlantic Treaty Organization led (NATO) International Security Assistance Force (ISAF) and the U.S.-led Operation Enduring Freedom (OEF) to develop a fully functional ANA and ANP. 79 The Afghanistan Compact also specified several benchmarks and timelines for achieving security goals. These benchmarks became the basis for security targets of the ANDS. 80 These original ANDS targets are summarized in Table 3.2. The GIRoA has made progress toward these goals and updated the targets to reflect changing conditions. For example, as of May 2009, the target ANA force size was 134,000 troops by December 2011, compared with 80,000 troops by the end of 2010, as specified in the original ANDS. 81 In addition, on March 27, 2009, the President of the United States announced a new strategy for Afghanistan. According to the President, this strategy includes increasing U.S. military forces in Afghanistan and shifting the emphasis of the U.S. mission to training and increasing the size of the ANSF. 82 International Security Assistance Force (ISAF): An international coalition formed as a result of the Bonn Conference and designed to assist the GIRoA in securing and rebuilding Afghanistan 83 Operation Enduring Freedom (OEF): The U.S.-led operation conducting counterterrorism combat missions and training the ANSF 84 TABLE 3.2 ANDS PILLAR I: SECURITY Projected Date Target Description End 2010 Afghan National Army The ANA will achieve and surpass a milestone of 80,000 troops (plus 6,600 in training), and it will ensure that 75% of fi eld battalions and brigades are capable of conducting independent operations (with the addition of some external enablers and air support). Removing Unexploded Ordnance 3/20/2011 Disarmament of Illegal Armed Groups 2012 Removing Unexploded Ordnance 2013 Removing Unexploded Ordnance Counter-narcotics The land area contaminated by mines and unexploded ordnance will be reduced by 70%. All illegal armed groups will be disbanded in all provinces. Ninety percent of all known areas contaminated by mines and explosive remnants of war will be cleared. All emplaced anti-personnel mines will be cleared. By 2013, areas under poppy cultivation will be reduced by half compared with 2007 levels. End 2013 Afghan National Police The Ministry of Interior will achieve a target strength of 82,180 professional policemen (including Afghan Border Police). Notes: This table summarizes the information in the ANDS. Please see the ANDS in Appendix J of the October 2008 SIGAR Quarterly Report for additional details. These original targets have been provided for historical context and may have changed since they were published. Source: GIRoA, Afghanistan National Development Strategy, 6/2008, pp. 4, 6. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

56 SECURITY Training Organizations Since 2002, the United States and the international community, in partnership with the GIRoA, have trained the ANA and ANP. The United States, through the Combined Security Transition Command-Afghanistan (CSTC-A), leads the international ANSF training efforts in conjunction with NATO s ISAF and the European Union Police Mission in Afghanistan (EUPOL). 85 Combined Security Transition Command-Afghanistan CSTC-A is a joint-service coalition organization under the control of the U.S. Central Command (CENTCOM). It has personnel from the United States, the United Kingdom, Canada, Poland, Albania, Germany, France, and Romania. Its mission, which began as the Office of Military Cooperation - Afghanistan in 2002, has evolved and currently is to help the Ministry of Interior (MOI) and the Ministry of Defense (MOD) develop and manage the ANSF so it can combat insurgency, establish and maintain the rule of law, and achieve security and stability in Afghanistan. 86 CSTC-A evolved from two prior organizations. See Figure 3.22 for a timeline of this evolution. Under the operational control of CSTC-A are the Combined Joint Task Force Phoenix (CJTF Phoenix) and five Afghan Regional Security Integration Commands (ARSICs). 87 COMBINED JOINT TASK FORCE PHOENIX CJTF Phoenix is a joint task force that trains and mentors the ANSF to prepare the ANA and ANP to conduct independent security operations that create stability in Afghanistan. 88 FIGURE 3.22 THE EVOLUTION OF CSTC-A MAY 2002: Office of Military Cooperation-Afghanistan (OMC-A) Established JULY 2005: Office of Security Cooperation- Afghanistan (OSC-A) Established APRIL 2006: Combined Security Transition Command-Afghanistan (CSTC-A) Established Sources: DoS and DoD, Inspectors General, Interagency Assessment of Afghanistan Police Training and Readiness, 11/2006, p. 9. DoD, DefenseLINK, Afghanistan Unit Takes on New Mission, Name, 7/13/2005, accessed 7/7/2009. CSTC-A, Combined Security Transition Command-Afghanistan, Fact Sheet, 5/21/2008, p SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

57 SECURITY AFGHAN REGIONAL SECURITY INTEGRATION COMMANDS ARSICs are regional commands attached to each of the five ANA corps located across Afghanistan. The North, South, East, West, and Central ARSICs support the CSTC-A mission. 89 INTERNATIONAL SECURITY ASSISTANCE FORCE Following the Bonn Conference, the ISAF was created to help the Afghan Transitional Authority secure Kabul and support the national reconstruction effort. 90 NATO assumed leadership of the ISAF in 2003, after six-month national rotations by (1) the United Kingdom, (2) Turkey, and (3) Germany and the Netherlands. 91 In 2003, when NATO took command, the ISAF had about 5,000 troops. 92 The U.S. Department of State (DoS) reported that as of June 2009, the ISAF had expanded to about 61,000 troops from 42 countries. 93 The ISAF helps develop the ANSF through training, mentoring, and equipment donations. In addition, it collects, catalogues, and destroys illegal weapons and ordnance. 94 European Union Police Mission in Afghanistan In 2007, EUPOL replaced the German Police Project Office, which had taken the lead on police training in April Nineteen European Union (EU) member states plus Canada, Croatia, New Zealand, and Norway support the EU police mission to establish an effective civil police force that interacts appropriately with the wider criminal justice system under Afghan ownership. 96 ANA soldiers in a squad leader s class listen to a lesson by Kabul Military Training Center NCO Instructors at Camp Zafar in Herat. (ISAF photo) REPORT TO THE UNITED STATES CONGRESS I JULY 30,

58 BACKGROUND THE AFGHAN NATIONAL ARMY History On December 1, 2002, Afghan President Hamid Karzai issued a decree that created the ANA. This all-volunteer army is composed of soldiers from all of Afghanistan s ethnic groups. 97 Mission The mission of the ANA is to maintain the stability of the country, defend its sovereignty, and contribute to regional security, while maintaining its regional and ethnic balance and continuing to develop its reputation as a respected, accountable, and professional force. 98 Organization The ANA falls under the MOD. MOD and the ANA are made up of several components, including the MOD and general staff, sustaining institutions, intermediate command staff, combat forces, and Afghan National Army Air Corps (ANAAC) personnel. 99 See Table 3.3 for descriptions of these components. The ANA combat forces are divided into five corps. A typical corps contains one or more brigades and is organized into the structure depicted in Figure The ANA corps are located in different regions of Afghanistan. See Figure 3.24 for a map with the locations of the corps. TABLE 3.3 MOD AND ANA COMPONENTS Authorized Component Description Personnel Ministry of MOD is responsible for developing, fi elding, 3,246 Defense and and ensuring the operational readiness of General Staff the ANA. MOD develops strategic plans to defend Afghanistan. The general staff implements MOD policies and guidance for the ANA. Support facilities installation and management, acquisitions, logistics, communica- 1,519 Sustaining Institutions tions support, regional military intelligence offi ces, detainee operations, medical Intermediate command, ANA training and recruiting 15,484 Command Staff commands, military police, and the Headquarters Support and Security Brigade. a Combat Forces Conducts the ANA s operations. 66,406 Air Corps Supports the ANA and ANP through attack 3,412 air support, medical evacuation, and presidential transport. Other b 13,408 Total 103,475 Notes: Authorized Personnel numbers appear as reported in the June 2009 DoD report, Progress toward Security and Stability in Afghanistan. a An ANA unit that performs specialist tactical and ceremonial missions. b Other includes data for Detainee Operations, CN Infantry Kandak, and TTHS. Source: GAO, Afghanistan Security, Further Congressional Action May Be Needed To Ensure Completion of a Detailed Plan To Develop and Sustain Capable Afghan National Security Forces, Report GAO , 6/2008, pp. 19, 54. DoD, Progress toward Security and Stability in Afghanistan, 6/2009, p. 26. FIGURE 3.23 ORGANIZATION OF A TYPICAL ANA CORPS CORPS BRIGADE Corps Brigade (2800) BATTALION Light Infantry (650) Light Infantry (650) Light Infantry (650) Combat Support (500) Combat Support Services (350) Note: A corps has one or more brigades. A brigade has five battalions. Actual ANA corps organizations may differ from the one presented here. Source: GAO, Afghanistan Security, Further Congressional Action May Be Needed To Ensure Completion of a Detailed Plan To Develop and Sustain Capable Afghan National Security Forces, Report GAO , 6/2008, p SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

59 BACKGROUND FIGURE 3.24 ANA CORPS AND ANAAC REGIONAL LOCATIONS UZBEKISTAN TAJIKISTAN CHINA TURKMENISTAN Mazar-e Sharif 209th Corps Herat 207th Corps & Herat Regional Support Squadron Kabul 201st Corps & Kabul Air Wing Gardez 203rd Corps & Gardez Regional Support Squadron Jalalabad Jalalabad Regional Support Squadron IRAN Kandahar 205th Corps & Kandahar Arm Wing PAKISTAN Sources: GAO, Afghanistan Security, Further Congressional Action May Be Needed To Ensure Completion of a Detailed Plan To Develop and Sustain Capable Afghan National Security Forces, Report GAO , 6/2008, p. 22. CSTC-A, "Fact Sheet Afghan National Army," 3/15/2009. The Long War Journal, Afghan National Security Forces Order of Battle, accessed 6/21/2009. Troop Levels DoD reported that as of May 2009, the ANA had 86,558 troops, comprising 74 battalions. DoD predicts that the ANA will grow to its target of 134,000 troops by December REPORT TO THE UNITED STATES CONGRESS I JULY 30,

60 SECURITY Basic Warrior Training Course: The initial training recruits receive upon entry to the ANA 102 Advanced Combat Training: The branchspecifi c training soldiers receive to strengthen their capabilities 103 THE AFGHAN NATIONAL ARMY Overview of ANA Training New recruits take the Basic Warrior Training Course at the Kabul Military Training Center, where they are taught by Afghan trainers with international support. This course establishes basic standards to provide uniformity across ANA training. Soldiers also receive branch-specific Advanced Combat Training. Once a unit is fielded, its soldiers receive 60 days of individual and collective training before combat operations. 104 According to DoD, each Afghan unit is accompanied by a U.S. Embedded Training Team or a NATO-ISAF Operational Mentoring and Liaison Team. These teams advise ANA unit leadership and provide direct access to U.S. and NATO- ISAF resources. These teams also assess ANA units, identifying strengths, development opportunities, and gaps that may exist. 105 FIGURE 3.25 UNIT TRAINING WITHIN ANA TRAINING COMMAND, JANUARY 1 JUNE 27, 2009 Total Units: 8, Total Graduates: 3,305 TURKMENISTAN Herat 207th Corps 379 GRADUATES UZBEKISTAN Mazar-e Sharif 209th Corps 1,989 GRADUATES Kabul 201st Corps 404 GRADUATES 533 GRADUATES Gardez 203rd Corps TAJIKISTAN Unit 1/2/209 5/2/209 HQ/2/209 2/2/209 3/2/209 1/1/201 4/3/203 6/4/205 CHINA No. of Graduates IRAN Kandahar 205th Corps PAKISTAN Source: CSTC-A, response to SIGAR data call, 7/1/ SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

61 SECURITY Training Status CSTC-A reported that 25,712 ANA troops graduated from programs within the Afghan National Army Training Command (ANATC) between January 1 and June 27, Of this total, nearly 82% graduated from Soldier Courses. See Figure 3.26 for individual training graduates by course category. 106 CSTC-A reported that between January 1 and June 27, 2009, eight units comprising 3,305 troops graduated from ANATC unit training programs. More than half of these units, representing 1,989 graduates, were fielded to the 209 th Corps in Mazar-e Sharif. See Figure 3.25 for additional details on where these units were fielded. 107 ANA Readiness The MOD uses a readiness reporting system that provides a metrics-based analytical and decision-support tool to improve ANA readiness. Each unit is evaluated to determine its ability to conduct operations and assigned one of four Capability Milestone (CM) ratings that reflects the unit s capabilities. Units capable of conducting primary operations with little or no assistance might be rated at CM1 while newly formed units that are not capable of conducting primary operational missions might be rated at CM4. The units are evaluated on a monthly basis so that the ANA forces can be managed effectively. 108 CM1 describes a unit, agency, staff function, or installation that is capable of conducting primary operational missions. Depending on the situation, units may require specific assistance from international partners. CM2 describes a unit, agency, staff function, or installation that is capable of conducting primary operational missions with routine assistance from, or reliance on, international community support. CM3 describes a unit, agency, staff function, or installation that is capable of partially conducting primary operational missions, but still requires assistance from, and is reliant on, international community support. CM4 describes a unit, agency, staff function, or installation that is formed, but not yet capable of conducting primary operational missions. It may be capable of undertaking portions of its operational mission, but only with significant assistance from, and reliance on, international community support. 109 FIGURE 3.26 INDIVIDUAL TRAINING WITHIN ANA TRAINING COMMAND, JANUARY 1 JUNE 27, 2009 Miscellaneous Courses 273 Total Graduates: 25,712 Soldier Courses 21,077 Officer Courses 1,926 Non- Commissioned Officer Courses 2,436 Source: CSTC-A, response to SIGAR data call, 7/1/2009. Capability Milestone (CM): DoD criteria for assessing ANA and ANP progress in manning, training, and equipping their forces. CMs range from the most capable, CM1, to the least capable, CM REPORT TO THE UNITED STATES CONGRESS I JULY 30,

62 SECURITY FIGURE 3.27 STATUS OF ASFF FUNDS FOR ANA INFRA- STRUCTURE, FY ($ MILLIONS) FIGURE 3.29 ANA CAPABILITY MILESTONE RATINGS (ANA UNITS) $2,000 Available $2, Obligated $2, Capability Milestone (CM) CM1: capable of operating independently CM1 Total Units: $1,950 Disbursed $1, CM2: capable of planning, executing, and sustaining operations at the battalion level with international support CM3: partially capable of conducting operations at the company level with support from international forces CM2 CM CM4: formed but not yet capable of conducting primary operational missions CM4 7 Notes: Numbers affected by rounding and are as of 6/30/2009. ASFF funding terms (available, obligated, disbursed) reported as provided by DoD except as specified. Source: DoD, response to SIGAR data call, 7/10/2009. Note: May not include fire support, close air support, and MEDEVAC. Source: DoD OSD, response to SIGAR data call, 7/8/2009. Numbers as of 5/23/ FIGURE 3.28 STATUS OF ASFF FUNDS FOR ANA EQUIPMENT AND TRANSPORTATION, FY ($ MILLIONS) $4,100 Available $4, Obligated $4, CSTC-A reported that as of May 23, 2009, 47 ANA units, out of 123 rated, were assessed at CM See Figure 3.29 for a summary of ANA CM ratings. Infrastructure Status DoD reported that as of June 30, 2009, $2.01 billion has been made available to the ASFF for ANA infrastructure. Of this amount, $2.00 billion has been obligated and $1.94 billion has been disbursed. 112 Figure 3.27 depicts the status of ASFF funds for ANA infrastructure. $4,050 Disbursed $4, Equipment and Transportation Status DoD reported that as of June 30, 2009, $4.11 billion has been made available to the ASFF for ANA equipment and transportation. Of this amount, $4.08 billion has been obligated and $4.04 billion has been disbursed. 113 Figure 3.28 depicts the status of ASFF funds for ANA equipment and transportation. $0 Notes: Numbers affected by rounding and are as of June 30, ASFF funding terms (available, obligated, disbursed) reported as provided by DoD except as specified. Sources: DoD, response to SIGAR data call, 7/10/ SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

63 SECURITY Challenges Attacks DoD reported on the number of attacks against the ANA from October 2006 through June 20, This data covered attacks in 30 of Afghanistan s 34 provinces. Since October 2006, the ANA has come under 1,277 attacks across Afghanistan. In 2009, the ANA came under 192 attacks across 21 provinces. The most attacks took place in three neighboring provinces Helmand, Kandahar, and Zabul all of which border Pakistan. Attacks in these provinces made up 50.0% of all the attacks in 2009 and 51.7% of all attacks since October See Figure 3.30 for the attacks on the ANA by province and year. Casualties Since 2007, 1,980 ANA soldiers have been wounded in action and 651 have been killed in action. From January 1 through June 22, 2009, 355 ANA soldiers were wounded in action and 114 were killed in action. 115 See Figure 3.31 for a yearly comparison of ANA casualties. FIGURE 3.30 ATTACKS ON THE ANA BY PROVINCE, OCTOBER 2006 JUNE 20, 2009 FIGURE 3.31 ANA CASUALTIES, , Total Wounded in Action: 1,980 Total Killed in Action: Wounded in Action (full/partial year) Killed in Action (full/partial year) Note: a Numbers are as of 6/22/2009. Source: CSTC-A, response to SIGAR data call, 7/1/2009. a Total Attacks: 1, (Oct 1 Dec 31) (Jan 1 June 20) 0 Attacks 1 5 Attacks 6 15 Attacks Attacks Attacks Notes: This data does not necessarily represent a measure of a province's security. For example, a province with no attacks could mean that the ANA experienced no attacks or that its presence and missions in the province were different than in other provinces. Multiple casualties could occur per attack. Source: CSTC-A, response to SIGAR data call, 7/1/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

64 BACKGROUND THE AFGHAN NATIONAL POLICE History In 2002, Germany led the effort to rebuild the ANP. 116 In 2005, the United States took over as lead nation for reforming the ANP. In 2007, the European Union began its EUPOL mission. 117 Goal The international goal is to create an effective, wellorganized, multi-ethnic, and professional police force that can provide a stable rule of law. 118 FIGURE 3.32 ORGANIZATION OF MOI AND ANP Deputy Minister for Counter narcotics Minister of Interior Deputy Minister for Security Organization The ANP falls under the Ministry of Interior (MOI). The MOI and ANP comprise several components, including the MOI, the Afghan Uniformed Police (AUP), the Afghan Border Police (ABP), the Afghan National Civil Order Police (ANCOP), and the Counter-narcotics Police of Afghanistan (CNPA). See Table 3.4 and Figure 3.32 for descriptions of these components. ANP training takes place at the Central Training Center in Kabul and at one of seven Regional Training Centers. 119 See Figure 3.33 for the locations of these training centers. Deputy Uniformed Police Chief a Afghan National Civil Order Police Chief Border Police Chief Note: The graphic has been simplified to illustrate the components in the table below and does not show the full organizational structure of the MOI. a The ANP regional commanders report to the deputy uniformed police chief. Sources: DoD, Progress toward Security and Stability in Afghanistan, June 2009, p. 26. GAO, Afghanistan Security, U.S. Programs To Further Reform Ministry of Interior and National Police Challenged by Lack of Military Personnel and Afghan Cooperation, Report GAO , 3/2009, p. 36. TABLE 3.4 MOI AND ANP COMPONENTS Component Description Authorized Personnel MOI Responsible for enforcing the rule of law. 5,059 Afghan Uniformed Police Assigned to police districts and provincial and regional commands; duties include patrols, crime prevention, traffi c 47,384 duties, and general policing. Afghan Border Police Provides broad law enforcement capability at international borders and entry points. 17,621 Afghan National Civil Specialized police force trained and equipped to counter civil unrest and lawlessness. 5,365 Order Police Counter-narcotics Law enforcement agency charged with reducing narcotics production and distribution in Afghanistan. 2,519 Police of Afghanistan Other 8,852 Total 86,800 Note: Authorized Personnel numbers appear as reported in the June 2009 DoD report, Progress toward Security and Stability in Afghanistan. Source: GAO, Afghanistan Security, U.S. Programs To Further Reform Ministry of Interior and National Police Challenged by Lack of Military Personnel and Afghan Cooperation, Report GAO , 3/2009, p. 35. DoD, Progress toward Security and Stability in Afghanistan, 6/2009, p SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

65 BACKGROUND FIGURE 3.33 ANP TRAINING CENTERS UZBEKISTAN CHINA TAJIKISTAN CHINA TURKMENISTAN Mazar-e Sharif Konduz Bamyan Herat Kabul Jalalabad Gardez Central Training Center Regional Training Center ANP Regional Commands IRAN Kandahar PAKISTAN Gardez Kandahar Herat Mazar e Sharif Kabul Source: CSTC-A, Fact Sheet Afghan National Police, 3/15/2009, p. 1. Police Levels DoD reported that as of May 2009, the ANP stood at 81,509 personnel. DoD reported that in April 2009, the Joint Coordination and Monitoring Board (JCMB) approved an increase in ANP target end-strength to 86, Joint Coordination and Monitoring Board (JCMB): The entity established by the GIRoA and the international community that is responsible for coordinating international assistance efforts in Afghanistan 121 REPORT TO THE UNITED STATES CONGRESS I JULY 30,

66 SECURITY THE AFGHAN NATIONAL POLICE Overview of ANP Training In 2002, Germany took the lead for developing the ANP. 122 It created a three-year training program for police officers and a one-year training program for noncommissioned officers (NCOs). A year later, the Department of State Bureau of International Narcotics and Law Enforcement Affairs (INL) began a police training mission to address concerns about the slow progress of the German program. 123 The INL constructed the Central Police Training Center for Police in Kabul as well as several regional training centers (RTCs). 124 In 2005, the Office of Military Cooperation - Afghanistan (renamed CSTC-A in 2006) took over as the lead for developing the ANP. 125 The INL is responsible for managing the task order for the civilian police training and mentoring mission, which is directed by CSTC-A. Civilian police advisors deployed by the INL provide training and mentoring to the ANP at seven INL-operated regional training centers, a central training center located in Kabul, and field locations located across Afghanistan s 34 provinces. 126 To date, the United States has invested more than $6.2 billion in the ANP and MOI. 127 Members of the Afghan National Police prepare for their graduation in Maidan Shar, Wordak Province. (U.S. Army photo, SGT Joshua LaPere) 58 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

67 SECURITY Training Status CSTC-A reported that 20,898 ANP personnel were trained in 2008 and another 6,548 were trained between January and May The ANP is assessed against the same Capability Milestones as the ANA. As of May 23, 2009, 24 of the 559 ANP units that have been rated were assessed at CM See Figure 3.34 for a summary of ANP CM ratings. Infrastructure Status DoD reported that as of June 30, 2009, $1.34 billion has been made available to ASFF for ANP infrastructure. Of this amount, nearly all the funds have been obligated and disbursed. 130 Equipment and Transportation Status DoD reported that as of June 30, 2009, $1.32 billion has been made available to the ASFF for ANP equipment and transportation. Of this amount, nearly all has been obligated and disbursed. 131 Figure 3.35 depicts the status of ASFF funds for ANP equipment and transportation. FIGURE 3.35 STATUS OF ASFF FUNDS FOR ANP EQUIPMENT AND TRANSPORTATION, FY ($ MILLIONS) $1,321.0 $1,320.0 $1,319.0 $1,318.0 $1,317.0 $1,316.0 $1,315.0 Available $1, Obligated $1, Disbursed $1, $0 FIGURE 3.34 ANP CAPABILITY MILESTONE RATINGS (ANP UNITS) Notes: Numbers affected by rounding and are as of June 30, ASFF funding terms (available, obligated, disbursed) reported as provided by DoD except as specified. Source: DoD, response to SIGAR data call, 7/10/2009. Capability Milestone (CM) Total Units: 559 CM1: capable of operating independently CM1 24 CM2: capable of planning, executing, and sustaining operations at the battalion level with international support CM2 27 CM3: partially capable of conducting operations at the company level with support from international forces CM3 71 CM4: formed but not yet capable of conducting primary operational missions CM Source: DoD OSD, response to SIGAR data call, 7/8/2009. Numbers as of 5/23/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

68 SECURITY FIGURE 3.36 ANP CASUALTIES, ,500 1, Total Wounded in Action: 2,885 Total Killed in Action: 1,764 1,036 1, a Wounded in Action (full/partial year) Killed in Action (full/partial year) Challenges Attacks DoD reported on the number of attacks against the ANP from October 2006 through June 20, This data covered attacks in 32 of Afghanistan s 34 provinces. Since October 2006, the ANP has come under 2,839 attacks across Afghanistan. In 2009, the ANP came under 532 attacks across 25 provinces. Most attacks took place in two neighboring provinces Kandahar and Helmand both of which border Pakistan. Attacks in these provinces made up 42.1% of all the attacks in 2009 and 31.1% of all attacks since October See Figure 3.37 for the attacks on the ANP by province and year. Casualties Since 2007, 2,885 ANP personnel have been wounded in action and 1,764 have been killed in action. From January 1 through June 22, 2009, 640 ANP personnel were wounded in action and 352 were killed in action. 133 See Figure 3.36 for a comparison of yearly ANA casualties. a Numbers as of 6/22/2009. Source: CSTC-A, response to SIGAR data call, 7/1/2009. FIGURE 3.37 ATTACKS ON THE ANP BY PROVINCE, OCTOBER 2006 JUNE 20, 2009 Total Attacks: 2,839 1,200 1,148 1, (Oct 1 Dec 31) (Jan 1 June 20) 0 Attacks 1 10 Attacks Attacks Attacks Attacks Notes: This data does not necessarily represent a measure of a province's security. For example, a province with no attacks could mean that the ANP experienced no attacks or that its presence and missions in the province were different than in other provinces. Multiple casualties could occur per attack. Source: CSTC-A, response to SIGAR data call, 7/1/ SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

69 SECURITY Security Concerns CSTC-A reported that it cancelled 28 ANP construction projects for security reasons. Of these, one contract was terminated for convenience and 27 projects were de-scoped from existing contracts. The awarded amounts on these contracts totaled $33.53 million. 134 As illustrated in Figure 3.38 these security concerns affected projects in all regions of Afghanistan except for the northern region. FIGURE 3.38 ANP PROJECTS CANCELLED DUE TO SECURITY CONCERNS ($ MILLIONS) Total Contract Awards: $33.53 Million UZBEKISTAN TAJIKISTAN CHINA TURKMENISTAN JOWZJAN BALKH KUNDUZ TAKHAR BADAKHSHAN IRAN HERAT $0.88 F ARAH BADGHIS $1.23 FARYAB GHOR URUZGAN NIMROZ HELMAND KANDAHAR $7.31 $1.36 ZABUL SAMANGAN GHAZNI BAGHLAN LOGAR PAKTIYA PAKTIKA $0.45 PAKISTAN PANISHIR SAR-E PUL PARWAN BAMYAN $0.45 KABUL WARDAK DAYKUNDI $1.87 KAPISA NURISTAN $1.65 LAGHMAN KUNAR KHOWST $9.18 NANGARHAR $9.16 Amount of Contract Awards ($ Millions) <$1 $ $ >$7 Note: Numbers affected by rounding. Source: CSTC-A, response to SIGAR data call, 7/1/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

70 SECURITY The goal of the Governance, Rule of Law, and Human Rights Pillar is to strengthen democratic processes and institutions and extend human rights, the rule of law, delivery of public services and government accountability. Afghanistan National Development Strategy: Governance, Rule of Law & Human Rights 62 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

71 GOVERNANCE GOVERNANCE, RULE OF LAW, AND HUMAN RIGHTS OVERVIEW This section addresses Afghanistan s recent developments in the areas of governance, rule of law, and human rights. During this reporting period, the people of Afghanistan and the international community were preparing for the August 20, 2009 presidential and provincial council elections. The United States considers these elections to be an important milestone on Afghanistan s road to improved governance. As U.S. President Barack Obama noted in a press release dated June 16, 2009, the United States support[s] the right of the people of Afghanistan to choose their leaders. 135 August 20, 2009 Elections Afghanistan s Independent Election Commission (IEC) is responsible for conducting the August 20, 2009, elections with support from the Government of the Islamic Republic of Afghanistan s (GIRoA s) Ministry of Interior (MOI) and Ministry of Defense (MOD), and international security forces. 136 As of May 9, 2009, Afghanistan had 41 presidential candidates, including two women. 137 To win the presidential election, a candidate must receive a majority of votes, at least 50% plus one. 138 If any candidate fails to receive 50% plus one or more valid votes, a second-round (run-off) election will be held. 139 The candidate who accrues the most votes is declared the winner. 140 Some 3,324 individuals, including 342 women, are contesting 420 seats in 34 provincial council elections. 141 Unlike the 2004 democratic elections, the international community s role is primarily advisory. Under the authority of United Nations (UN) Security Council Resolution 1806, dated March 20, 2008, the international community is supporting the elections through the UN Assistance Mission in Afghanistan (UNAMA), which designated the UN Development Programme s Enhancing Legal and Electoral Capacity for Tomorrow (UNDP/ELECT) project to coordinate international assistance for the election process. 142 The United States has contributed $120 million to UNDP/ELECT to support the elections. 143 The U.S. Agency for International Development (USAID) is funding separate elections-related activities through a number of local monitoring groups in Afghanistan, as well as U.S. non-governmental organizations (NGOs), such as the International Republican Institute (IRI), the National Democratic Institute, AFGHANISTAN NATIONAL DEVELOPMENT STRATEGY (ANDS) REGIONAL COOPERATION COUNTER-NARCOTICS ANTICORRUPTION GENDER EQUALITY CAPACITY ENVIRONMENTAL DEVELOPMENT GOVERNANCE SECURITY Adopted on March 20, 2008, UN Security Council Resolution 1806 affi rmed the UN s commitment to Afghanistan s journey to achieving sovereignty, independence, territorial integrity and national unity. 145 Resolution 1806 further supports the GIRoA and the Afghan people in their efforts to strengthen the foundations of sustainable peace and constitutional democracy. 146 REPORT TO THE UNITED STATES CONGRESS I JULY 30,

72 GOVERNANCE The United States seeks an enduring partnership with the Afghan people, not with any particular Afghan leader enabling the newly elected president and other officials to deliver governance, security, justice, and economic opportunity to all Afghans. U.S. President Barack Obama 147 and the International Foundation for Electoral Systems. 144 According to the U.S. Department of Defense (DoD), the United States is focused on ensuring the integrity of the election process. 148 The GIRoA is leading the election-planning security efforts, with U.S. Forces - Afghanistan (USFOR-A) and the International Security Assistance Force (ISAF) playing supporting roles. 149 DoD reported that the following guidelines should be a priority for all stakeholders in the elections process: security and transportation access for presidential candidates the presence of the necessary international observers with the appropriate logistical support freedom for the media and the press to report on the election security and logistical support for IEC, including the IEC Election Complaints Commission adequate security preparations 150 implementation of a strategic communications plan Election Challenges Security According to the UN, the minister of Interior s most immediate priorities include providing security in principal cities and along highways on Election Day and ensuring the 2009 elections are conducted in a free, fair, and transparent manner. 151 MOI is responsible for assigning specially trained law-enforcement officials knowledgeable in election procedures to properly maintain security during the election. 152 The Afghan National Army (ANA) and the Afghan National Police (ANP), with peripheral support from the International Security Assistance Force (ISAF), are responsible for election security. 153 USAID announced plans to support the IEC s mission to implement anticorruption measures to safeguard the August elections. 154 The IEC issued an official publication describing individual responsibilities for securing polling stations, identifying authorized persons permitted in the polling centers, and establishing the role of the international military on Election Day. 155 Anti-fraud Protections Voters who registered in the 2004 and 2005 elections will be able to re-use their registration cards in the August elections. 156 In November 2008, the IEC launched a voter-registration campaign targeting individuals who had lost their registration cards, relocated within the country, or became eligible to vote since The IEC completed four phases of voter registration between November 2008 and February The UN estimated a total of 4.5 million Afghans, with approximately 38% being women, registered to vote during this period (see Figure 3.39). 159 Notably, the UN reported that 546,533 of the new registered voters live in some of the most volatile provinces SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

73 BACKGROUND GOVERNANCE INDEPENDENT ELECTION COMMISSION The IEC is responsible for setting policy, overseeing, and administering the election. 161 The IEC is composed of a board of seven commissioners, appointed by the president. 162 The IEC Secretariat is headed by a chief electoral officer. 163 Although the Afghanistan Constitution stipulated that elections be held 30 to 60 days before the expiration of the president s term, which was supposed to end on May 22, the IEC postponed elections to August 20, 2009, to encourage a greater voter turnout. 164 The international community endorsed the postponement, agreeing that additional time was needed to ensure the maximum number of Afghans would have the opportunity to participate in the elections. 165 In response to protests over the postponement, the president of Afghanistan issued a decree on February 28, 2009, requesting the IEC to ensure elections were held in accordance with all relevant articles of the Constitution. 166 The IEC published a statement affirming its selection of August 20 as the election date. 167 Relevant Afghan Constitutional Provisions Article 156 of the Afghanistan Constitution vests exclusive authority to the IEC to manage and oversee all elections. 168 Article 157 of the Afghanistan Constitution identifies the IEC as the entity responsible for monitoring implementation of the articles of the Constitution for uniformity and consistency. 169 Presidential Eligibility Article 62 of the Afghanistan Constitution sets forth the eligibility criteria for presidential candidates. 170 To qualify as president, a candidate must: be a citizen of Afghanistan, Muslim, and born of Afghan parents be at least 40 years old on the day of candidacy never have been convicted of a crime be independent of a non-official military force have not served more than two terms in office. 171 An Afghan citizen places his ballot in a box after he voted in the country s first parliamentary elections in (U.S. Army photo, SPC Jason R. Krawczyk) STRUCTURE OF INDEPENDENT ELECTION COMMISSION Operational Deputy Chairman, Deputy, and 7 Members of IEC Chief Executive Officer Field Operation Department 34 IEC Secretariat Provincial Offices Administrative Deputy Source: IEC, IEC Structure, accessed 7/17/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

74 GOVERNANCE FIGURE 3.39 NUMBER OF REGISTERED VOTERS, NOVEMBER 2008 FEBRUARY 2009 Total: 4,500,000 Men 2,790,000 Women 1,710,000 Note: Numbers affected by rounding and are estimates. Source: Report of the UN Secretary-General, The Situation in Afghanistan and Its Implications for International Peace and Security, 6/23/2009, p. 2. Agents:(political party and candidate agents, hereafter agents), are accredited members of political parties or representatives of independent candidates. Political parties and candidates must be registered by the IEC to nominate agents. 172 Observers:can be either domestic or international observers. Elections observers are representative of domestic and international organizations that are registered and accredited by the IEC. 173 The IEC has taken action to prevent multiple ballot casting. IEC announced that accredited agents and election observers would be used to ensure that the entire electoral process would be conducted in accordance with all laws, regulations, and international standards. 174 According to IEC, all voters must prove their identity in advance of receiving a paper ballot. 175 Each voter will have the right to vote in secrecy, and upon receiving a ballot each voter s finger will be dipped in indelible ink. 176 Following the closing of all polling locations, each polling station has been instructed to count the ballots and seal the original tallies in a tamper-evident bag to transfer to the national tallying center in Kabul. 177 The IEC will conduct a fraud investigation if there is any evidence that the tamper-evident bag was compromised. 178 Following resolution of all fraud investigations or rectified errors, the IEC will certify the results. 179 Afghan Public Opinion Poll The IRI recently reported that only 21% of Afghans surveyed characterize the political landscape in Afghanistan s regions as stable and peaceful. 180 According to the IRI, the objective of the poll was to gauge Afghan public opinion and use the information in support of Afghanistan s elections process. 181 Almost half of the respondents stated that Afghanistan s stability has declined over the past year. 182 The IRI poll was conducted May 3 16, According to the IRI, trained professionals conducted in-person interviews to collect the information used in the poll report. 184 Respondents from all 34 provinces participated. 185 GOVERNANCE Background The GIRoA faces intense international scrutiny in anticipation of the country s second democratic elections since the Taliban regime was removed from power. 186 The elections for the president and provincial officials will be the first GIRoA-orchestrated election in Afghanistan s history. 187 Since January 2004, Afghanistan has achieved significant accomplishments, notably, the adoption of a new constitution and its first democratic elections in accordance with the Constitution marking a new direction in Afghanistan s government structure. 188 However, USAID noted that factors such as Afghanistan s limited national and local government capacity, limited prosecution of high-level corruption activities, and struggles in operating transparent and accountable government support classifying Afghanistan as a developing country. 189 According to the World Bank governance ranking index, Afghanistan s percentile ranking in 2003 ranged from 1.4 to 8.7, compared with a range of 0.5 to 11.1 in Afghanistan s governance score in 2003, prior to the 2004 elections, was very low for each of the six governance indicators. 191 In 2008, both Afghanistan s governance score in each of the six governance indicators and its percentile rankings 66 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

75 GOVERNANCE increased slightly. 192 See Table 3.5 for Afghanistan s governance performance ranking. Afghanistan s governance scores during the period between 2003 and 2008 provide insight into its progress over the past five years in achieving and sustaining a free and fair democracy. The ANDS describes the GIRoA s roadmap over the next five-year period between 2008 and The Afghanistan National Development Strategy The ANDS identifies governance, rule of law, and human rights as one of its three pillars. 194 This pillar is designed to: support democratic processes and institutions improve human rights and the rule of the law augment delivery of public services and government accountability 195 The ANDS references a 2000 World Bank assessment that Afghanistan s governance capacity fell in the bottom 1% of all countries. 196 According to the ANDS, establishing a stable Islamic constitutional democracy with three independent and effective branches of government, all imbued with accountability and transparency, is an important vision for the GIRoA. 197 Part of that vision is having the GIRoA strengthen both its formal and its informal governance structure, with the immediate goal of creating an efficient and stable democratic political environment. 198 The ANDS builds upon the vision and the GIRoA s commitment, adopting specific benchmarks articulated in the Afghanistan Compact. 199 According to the Compact, democratic governance and the projection of human rights constitute the cornerstone of sustainable political progress in Afghanistan. 200 To achieve this objective, the GIRoA will identify candidates for public service TABLE 3.5 WORLD BANK GOVERNANCE INDICATORS, PERCENTILE RANKING Governance Indicators 2003 Percentile Ranking (0 100) 2003 Governance Score ( ) 2008 Percentile Ranking (0 100) 2008 Governance Score ( ) Voice and Accountability Political Stability Government Effectiveness Regulatory Quality Rule of Law Control of Corruption Note: Higher value indicates better governance ratings. Source: World Bank, Governance Indicators: Afghanistan, accessed 7/16/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

76 GOVERNANCE BACKGROUND HISTORICAL BACKGROUND OF AFGHANISTAN S POLITICAL LANDSCAPE The formal name of Afghanistan is the Islamic Republic of Afghanistan (Dowlat-e Eslami-ye-Afghanistan). 201 The acronym for the Government of the Islamic Republic of Afghanistan is GIRoA. 202 Following the execution of the Treaty of Rawalpindi, Afghanistan secured independence from the British Empire on August 19, Afghans celebrate August 19 as their National (Independence) Day. 204 During the 19th century, both Great Britain and Russia vied for control of Afghanistan, for its strategic location in the heart of central Asia and access to the Himalayan Mountains leading to India. 205 During this period, Great Britain discovered at the cost of significant casualties and financial loss that the Afghans reputation as ferocious and resilient warriors was well-earned. 206 Toward the end of the 20th century, the Union of Soviet Socialist Republics (Soviet Union), the successor to the Russian Empire, experienced the same lesson before withdrawing Soviet troops in defeat. 207 From 1919 through 2001, Afghanistan s governmental structure existed in various forms, including a constitutional monarchy, an unelected regime, tribal warlords, and a radical Islamic authority. 208 In 1933, Mohammad Zahir Shah was installed as Afghanistan s last king. 209 Zahir Shah s reign lasted 40 years. 210 During this period, Afghanistan maintained its neutrality during World War II and enjoyed several decades of internal peace. 211 In 1964, Zahir Shah amended the monarchy requirements in Afghanistan s Constitution. 212 In 1973, Mohammad Daoud staged a coup d état against Zahir Shah. 213 Daoud, Zahir Shah s cousin and brother-in-law, declared himself president and prime minister. 214 Under Daoud s leadership, the economy declined. 215 By 1978, a communist faction had ousted Daoud. 216 Various tribal groups continued competing for control of Afghanistan until the Soviet Union s invasion with 80,000 troops in The Soviet Union installed Babrak Karmal as president. 218 Mujahedeen guerrillas, composed of different factions throughout the country, launched a decade-long guerrilla war against the Karmal administration and Soviet occupation. 219 The war resulted in thousands of casualties, the collapse of the Afghan economy, and the creation of 5 to 6 million refugees. 220 The mujahedeen enjoyed combined support from Pakistan and the United States, which directly contributed to victory over the Soviets. 221 In 1989, the Soviet Union agreed to withdraw from Afghanistan. 222 The mujahedeen s military success was short-lived, as a civil war between the various factions ensued. 223 From 1992 through 1996, various political alliances jockeyed to become the leading political and military authority in Afghanistan. 224 In 1994, the Pashtun Taliban (Taliban), an Islamic fundamentalist group, leveraging POLITICAL EVOLUTION OF AFGHANISTAN 1933: Mohammad Zahir Shah installed as last king of Afghanistan AUG 19, 1919: Afghanistan s official date of independence from British rule 1933: Beginning of 40 years of peace Source: LOC, Country Profile: Afghanistan, 8/2008, p. 3, accessed 7/17/ SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

77 BACKGROUND GOVERNANCE public disenchantment with the previous ruling parties, emerged as a strong political force. 225 By 1996, the Taliban s military, economic, and social control extended over most of Afghanistan. 226 The Taliban, relying on strict Islamic principles, enacted a repressive regime that alienated many Afghans. 227 For example, the Taliban imposed rigid Muslim fundamentalist structures, closed girls schools, prohibited women from working, and required men to grow beards. 228 Post-Taliban Governance In 2001, a U.S.-led coalition, under the authority of the Bonn Conference, removed the Taliban leadership after it failed to respond to international pressure to surrender terrorist suspects who were using Afghanistan as a safe harbor. 229 As part of the Bonn Agreement, the international community transferred power to an Afghanistan Interim Authority on December 22, The Bonn Agreement mandated that an Emergency Loya Jirga be convened within six months to lead Afghanistan until free and fair elections could be held. 231 The Loya Jirga met between June 10, 2002, and June 20, 2002, when it granted the Transitional Authority 18 months to hold a second national Loya Jirga to draft a new Afghan Constitution and 24 months to hold national elections. 232 On January 4, 2004, the Constitutional Loya Jirga adopted Afghanistan s new Constitution, which provided protections for private property, a market economy, and the foundation for a democratic regime. 233 Afghanistan held free and fair democratic elections for president, the National Assembly, and the Provincial Councils in October Approximately 77% of all eligible voters, including women, participated. 235 On October 9, 2004, Hamid Karzai was elected president of Afghanistan. 236 Members of the Nangarhar PRT and Chaparhar Police Mentor Team meet with village elders at a school in Terelay Village. (U.S. Air Force photo, Capt. Dustin Hart) 1978: Mohammad Daoud overthrown by communist factions 1996: Taliban gains control of most of the country 2004: New constitution ratified; election of Hamid Karzai as the first president AUG 20, 2009: Ninety years following independence, the first Afghanistan governmentorganized elections scheduled : Coup d état by Mohammad Daoud; Mohammad Zahir Shah s reign ends 1979: Soviet Union invades with 80,000 troops; holy warriors engage in decade-long guerrilla war 1989: Soviet Union withdraws troops in defeat 2001: U.S.-led coalition forcibly removes Taliban leadership; Bonn Agreement executed 2006: Afghanistan Compact goes into effect 2008: Afghanistan National Development Strategy adopted REPORT TO THE UNITED STATES CONGRESS I JULY 30,

78 GOVERNANCE Improving governance is essential to the attainment of the Government s national vision and the establishment of a stable and functioning society. Afghanistan National Development Strategy: Governance, Rule of Law, & Human Rights Elected in October 2004, Hamid Karzai is the current president of Afghanistan. 237 As president, he is the leader of the executive branch, serves as the commander-in-chief of the armed forces, and is the head of state. 238 The president of Afghanistan serves a fi ve-year term. 239 The president s term expires on May 22 of the fi fth year subsequent to the previous election. 240 The Wolesi Jirga comprises 249 representatives and the Meshrano Jirga comprises 102 members. 241 The allocation of the Wolesi Jirga seats is calculated based on the distribution of the population geographically, and its members are elected by the people of Afghanistan. 242 The provincial councils, district councils, and the president appoint the 102 members of the Meshrano Jirga. 243 The National Assembly acts as the highest legislative body. 244 on the basis of merit and skill. 245 This change in philosophy marks the beginning of a more effective, accountable and transparent administration at all levels of government. 246 Another objective discussed in the Compact is implementing measurable improvements in fighting corruption, upholding justice and the rule of law, and promoting respect for the human rights of all Afghans. 247 As shown in Figure 3.40, the GIRoA is composed of three branches of government: executive, legislative, and judiciary. 248 Progress toward building sufficient capacity within each branch varies. The GIRoA faces many challenges such as high levels of corruption, an ineffective and poorly defined justice system, and security deficiencies that could potentially derail the GIRoA s forward momentum. 249 For the executive branch, ensuring the upcoming elections occur without incident has been the primary focus over the past quarter. The August 2009 elections represent an important milestone in the development of Afghanistan s political independence. According to DoD, the development of Afghanistan s governance capacity is progressing slowly. 250 The elections, an important governance objective, are significant to achieving the benchmarks for governance articulated in the Afghanistan Compact and adopted in the ANDS. 251 The GIRoA projects that successful completion of free and fair elections will improve the parliamentary and legislative processes. 252 Within the legislative branch, the National Assembly made some progress this year. 253 For example, the National Assembly passed a mortgage law and a private investment law, two much-needed laws intended to encourage economic development. 254 The National Assembly also made progress on legislation regulating water usage, the mining industry, and oil and gas production. 255 Despite some progress in key areas, the overall performance of the National Assembly has been poor because of absenteeism and the inability to pass routine legislation. 256 Notably, the Wolesi Jirga failed to reach a quorum on more than half of its business days during 2008, limiting its effectiveness on any given day. 257 On days when a quorum was reached, it was unable to sustain a quorum the entire day. 258 DoD reported that the U.S. and the international community continue to build the capacity of the judicial system in Afghanistan consistent with the ANDS ruleof-law objectives. 259 The GIRoA, with support from U.S. Department of Justice (DoJ) senior legal advisors, has increased the number of narcotics prosecutions under the Central Narcotics Tribunal (CNT) and Criminal Justice Task Force (CJTF) in Kabul. 260 Over a six-month period, DoD reported that the combined efforts of CJTF and the CNT resulted in the following: 261 investigation of 188 separate cases involving 201 suspects conviction of 113 suspects in district primary court; conviction of 189 suspects in appellate court handing over 503 individuals for incarceration According to the ANDS, strengthening public administration includes providing support for provincial and district governance capacity-building. 262 USAID s 70 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

79 GOVERNANCE FIGURE 3.40 AFGHANISTAN GOVERNMENT BRANCHES GOVERNMENT OF THE ISLAMIC REPUBLIC OF AFGHANISTAN (GIRoA) Legislative (National Assembly) Upper House Meshrano Jirga (102 Seats) Lower House Wolesi Jirga (249 Seats) Executive President Judiciary Stora Mahkama (Supreme Court) One of the objectives of the Afghanistan Compact is to establish a permanent civil and voter registry using a single national identification document by the end of st Vice President 2nd Vice President Provincial Court Stations (34 Courts) The Afghanistan Compact: Elections Ministers (23 Ministers) Primary Court Stations (408 Courts) Sources: Afghanistan Constitution, Chapter III (The President), Chapter IV (The Government), Chapter V (The National Assembly), Chapter VII (The Judiciary), 1/4/2004; Economist Intelligence Unit, Ltd., Afghanistan Country Profile 2008, p. 7. Local Governance and Community Development (LGCD) program, in alignment with the ANDS, provides mentors to provincial governors and line ministries and organizes small, community-led development activities to strengthen sub-national governance. 263 USAID s Afghan Municipal Strengthening Program s (AMSP) objectives are to improve existing governance procedures for municipalities. 264 Other programs focus on electricity, water, and sanitation services on a costrecovery basis, and a large, new municipal governance program is in the final approval stages. Human Rights Another objective discussed in the Afghanistan Compact and subsequently adopted in the ANDS is implementing measurable improvements in fighting corruption, upholding justice and the rule of law and promoting respect for the human rights of all Afghans. 265 Consistent with the ANDS, reducing the number of human rights violations is an important priority for the GIRoA. 266 According to DoD, improvements in human rights protection have been minimal. 267 The president of Afghanistan and the bicameral National Assembly, defi ned in the 2004 Constitution, are elected and appointed positions. 268 The National Assembly consists of two chambers: the lower chamber, Wolesi Jirga (House of the People), and the upper chamber, Meshrano Jirga (House of Elders). 269 REPORT TO THE UNITED STATES CONGRESS I JULY 30,

80 GOVERNANCE The UN Secretary-General reported that Afghanistan continues to encounter noteworthy human-rights challenges, attributed to decades of decline from weak governance, pervasive corruption, extreme poverty, and discriminatory laws and practices against women and girls. 270 AFGHANISTAN NATIONAL DEVELOPMENT STRATEGY (ANDS) REGIONAL COOPERATION COUNTER-NARCOTICS ANTICORRUPTION GENDER EQUALITY CAPACITY ENVIRONMENTAL SECURITY DEVELOPMENT GOVERNANCE Basic human rights and freedom are essential to building a strong free market economy in addition to being essential for any democracy. Afghanistan National Development Strategy: Human Rights Gender Equality Issues According to the ANDS, promoting gender equality by reversing historic discrimination against women is one of six cross-cutting areas. 271 The gender equality cross-cutting strategy articulates a roadmap to: change the treatment of women in society improve their social and economic status increase their access to development opportunities As defined in the ANDS, gender equality is when both women and men enjoy their individual rights and can equally contribute to and enjoy the benefits of development, and each is free to pursue a full and satisfying life. 272 Progress in achieving gender equality continues to pose a challenge. The ANDS identifies three important priorities to achieving gender equality: achieve the gender-specific benchmarks identified in the Afghanistan Compact (see Table 3.6) achieve all gender commitments described in each of the ANDS sectors create basic institutional capacities within the ministries and other government agencies related to gender integration 273 In March 2009, the president of Afghanistan signed the Shi a Personal Status Bill into law. 274 The United States has concerns that the Shi a Personal Status law violates the Afghanistan Constitution by permitting husbands the right to legally rape their wives. 275 DoD reported that in response to continued international and domestic protests, enforcement of the Shi a Personal Status law would be suspended pending the president of Afghanistan s review. 276 Refugees Over the past three decades, more than 6 million Afghans have become refugees, seeking international protection from neighboring countries such as the Islamic Republic of Pakistan and the Islamic Republic of Iran. 277 The UN High Commissioner for Refugees (UNHCR) estimated that 25% of the world s refugee populations are displaced Afghans. 278 According to UNHCR, Afghan refugees are dispersed in 69 countries. 279 The trend of Afghans fleeing the country is changing, however. In 2008, UNHCR estimated that more than 250,000 Afghan refugees returned home, bringing the number of Afghan refugees who have returned since 2002 to more than 5 million, approximately one-fifth of Afghanistan s population. 280 The GIRoA, in the ANDS, estimates that an additional 3 million Afghan refugees continue to live in the Islamic Republics of Iran and Pakistan, which strains relations between the 72 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

81 GOVERNANCE TABLE 3.6 ANDS GENDER EQUALITY BENCHMARKS Target Date Afghanistan Compact Benchmarks End 2010 National Action Plan for Women will be fully implemented. End 2010 National Acton Plan will be in line with Afghanistan s Millennium Development Goals. End 2010 Female participation in all Afghan governance institutions will be strengthened. End 2010 Prisons will have separate facilities for women. End 2010 Net enrollment in primary school for girls will be at least 60%. End 2010 Number of female teachers will be increased by 50%. End % of students enrolled in universities will be women (out of 100,000 students targeted). End 2010 Using public and private support, 150,000 men and women will receive training in marketable skills. End 2010 Number of female-headed households that are chronically poor will be reduced by 20%. End 2010 Employment rates for women will be increased by 20%. Note: The ANDS adopted the benchmarks and timelines from the Afghanistan Compact. Source: GIRoA, The Afghanistan Compact, 2/2006, Annex I, pp GIRoA and its neighbors. 281 As shown in Figure 3.41, 2.1 million Afghans fled to Pakistan and 900,000 Afghans fled to Iran. The ANDS presents a modified sector strategy that targets the remaining 3 million Afghans. 282 Under this revised strategy, the GIRoA projects that even with the implementation of specific programs focused on reintegrating refugees and internally displaced persons (IDPs), a significant population will still remain in Pakistan and Iran through The GIRoA estimates as many as 1 million Afghans or as few as 400,000 Afghans may voluntarily or forcibly return to Afghanistan. 284 JUDICAL REFORM AND PROSECUTION Judicial System Five U.S. agencies are involved with building Afghanistan s justice system: the Department of State (DoS) Bureau for International Narcotics and Law Enforcement (INL), DoJ, USAID, the Drug Enforcement Administration (DEA), and DoD. INL carries primary responsibility for justice reform in Afghanistan. 285 USAID has reported that Afghans are wary of a formal justice system. Their concerns relate to the integrity of the investigators, prosecutors, and judges, who are often part of the problem rather than the solution. 286 The ANDS describes the GIRoA s vision for the judiciary system to become an impartial and independent justice system that guarantees the security of life, religion, property, The ANDS strategic objective with respect to refugees, returnees, and IDPs is to efficiently manage their voluntary return and their reintegration into productive participation in society. FIGURE 3.41 Afghanistan National Development Strategy DISTRIBUTION OF AFGHAN REFUGEES IN ISLAMIC REPUBLICS OF IRAN AND PAKISTAN IRAN TURKMENISTAN 900,000 Refugees to Iran UZBEKISTAN 2,100,000 Refugees to Pakistan PAKISTAN Note: Numbers are affected by rounding. TAJIKISTAN CHINA REPORT TO THE UNITED STATES CONGRESS I JULY 30,

82 GOVERNANCE family and reputation, with respect for liberty, equality before the law, and access to justice for all. 287 When amended in 2004, the Constitution adopted three significant reforms to the Afghanistan judicial system. 288 Pursuant to Article 116 of the Constitution, (1) the judiciary acts as an independent organ of the State, (2) the Supreme Court is identified as the head of a unified judicial system, and (3) the Constitution is the guiding authority interpreting the law. 289 According to the ANDS, the GIRoA must install a legal framework consistent with the Constitution for civil, criminal, and commercial law by the end of 2010 (Table 3.7). 290 The ANDS describes Afghanistan s justice system as a combination of civil law and Islamic Sharia-based law that has evolved over time. 291 Within the non-urban areas, the ANDS identifies the customary legal system as based on traditional tribunals. 292 The ANDS further describes a customary system based on the principles of apology, forgiveness, and reconciliation. 293 Similarly, each Afghan province has committed to installing functioning institutions of justice by the end of Until that time, the GIRoA intends to continue focusing on reforming key institutions of justice, such as the Ministry of Justice (MOJ), the judiciary, the Attorney General s Office (AGO), MOI, and the National Directorate of Security to improve professionalism, credibility, and integrity. 295 U.S. Support for Justice Reform and Prosecution According to the Compact, judicial reformation in Afghanistan is a priority for both the GIRoA and the international community. 296 The Afghan judiciary is composed of one Supreme Court, 34 provincial court stations, and 408 primary court stations dispersed throughout 400 locations. 297 Independent judicial power is conferred on the Supreme Court, the highest court in Afghanistan. 298 TABLE 3.7 ANDS RULE OF LAW BENCHMARKS Target Date Afghanistan Compact Benchmark End 2010 Pursuant to the Constitution, implement legal framework, including civil, criminal and commercial law established and distributed to all judicial and legislative institutions. End 2010 Each province will have a fully operational and functioning institution of justice. End 2010 Reformation of oversight procedures relating to corruption, lack of due process and miscarriage of justice will be completely implemented. End 2010 Reformation of key justice institutions (MOJ, Judiciary, AGO, MOI, and the National Directorate of Security) to strengthen professionalism, credibility, and integrity. End 2010 Justice infrastructure will be rehabilitated to provide for separate facilities for men and women. Notes: The role of the justice sector in the government s development strategy is to ensure improved integrity, performance, and infrastructure of Afghanistan s justice institutions. Source: GIRoA, The Afghanistan National Development Strategy, 6/2008, p SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

83 GOVERNANCE In May 2005, supporting Afghanistan s judicial reform initiatives, INL developed a justice reform program for Afghanistan incorporating the following principles: Reconstruction in Afghanistan cannot succeed without a functioning criminal justice system to enforce the rule of law. The long-term effectiveness of the Afghan police program depends on a functioning criminal justice system. Counter-narcotics law enforcement efforts need to be accelerated and bolstered to effectively tackle the drug problem. 299 According to INL, these guiding principles are the foundation of the GIRoA s counter-narcotics justice system. 300 INL manages several programs to improve the administration of justice in Afghanistan. INL s Justice Programs The Counter-narcotics Justice program is part of the five-pillar counter-narcotics strategy, to which INL and DoJ provide funding, to establish a specialized task force for prosecuting narcotics cases. The program team includes six senior federal prosecutors, two to three criminal investigators, and members from the U.S. Marshals Service (USMS). 301 The Special Operations Group (SOG) of the USMS is not funded by INL or INL s mission. 302 INL also provides financial support to DoJ to conduct training and mentoring for Afghan prosecutors and police investigators within the CJTF. 303 Since 2007, the USMS Special Operations Group (SOG), funded separately from INL, assisted the Afghan judiciary with providing court security in Kabul. 304 In response to the chief justice s assassination several months ago, the USMS provides security for judiciary members. 305 According to DoJ, the USMS also conducts training activities pertaining to the operations of the Counter-narcotics Justice Center (CNJC). 306 The CNJC began operations on May, 1, 2009, according to INL. 307 INL reported that the CNJC will support GIRoA s continuous interdiction efforts. 308 The CNJC includes detention facilities and office space for prosecutors and judges as well as support facilities for occupants, such as dining and sleeping facilities. 309 DoJ reported that the number of security personnel trained or mentored and their achievements are the tools SOG uses to measure its own accomplishments. 310 SOG has mentored or trained 160 personnel and provided a total of 810 hours of training. 311 As of June 30, 2009, DoJ reported there have been no breaches of security or no reported attacks on CNJC. 312 In addition to the activities of the USMS, DoJ s criminal division and DEA provided limited assistance to judiciary security efforts. 313 According to DoJ, the criminal division assisted in the acquisition of armored vehicles used for judicial security. 314 The Justice Sector Support Program (JSSP), launched as a pilot program in 2005, is the INL s comprehensive approach to criminal justice reform. The JSSP provides support to the Afghan justice sector, including mentoring and training for MOJ, the AGO, and other relevant justice institutions. 315 The Attorney General s Offi ce assistance section (AGOAS) provided assistance to the Attorney General to draft the AGO s development strategy. The AGOAS is an independent component of the JSSP. In conjunction with MOI, it established the MOI-AGO Commission to improve coordination between the police force and prosecutors. 316 The Access to Justice and Integration Section (AJIS) partnered with MOJ to establish the Independent National Legal Training Center (INLTC) and to draft a charter establishing INLTC as the exclusive entity to certify prospective prosecutors and defense attorneys, as well as members of the Afghan Bar Association. The AJIS also is an independent component of JSSP. In 2008, the AJIS provided training and mentoring to more than 1,100 Afghan justice personnel. 317 The Corrections System Support Program (CSSP), established in 2006, is structured to support the Afghan Central Prison Directorate to provide training, capacity building, and infrastructure support. CSSP has more than 30 advisors deployed in various areas. 318 In partnership with the University of Washington School of Law, the INL established a legal education program providing fi nancial means for Afghan law professors to learn English as well as earn a degree or certifi cate. 319 REPORT TO THE UNITED STATES CONGRESS I JULY 30,

84 GOVERNANCE Counter-narcotics Justice System Afghanistan s Counter-Narcotics Justice System is composed of three main divisions: the CJTF, the CNT, and the CNJC, all based in Kabul. 320 CJTF is responsible for investigating and prosecuting counter-narcotics cases in Afghanistan. CNT, which has authority over all counter-narcotics-related crimes meeting certain criteria amounts (such as possession of 2 kg of heroin, 10 kg of opium, 50 kg of hashish, and precursor chemicals), presides over both counter-narcotics-related crimes and drug-related corruption. 321 CNJC is the venue for all trials. 322 CNJC opened its doors on May 1, It serves as a secure facility for holding and prosecuting major narcotics offenders. 324 DoD provided financial assistance for the construction of this facility. 325 As shown in Table 3.8, the JSSP regional program provides support to the Afghan judiciary. Strengthening the judiciary through mentoring supports GIRoA s vision for improving the justice sector of Afghanistan is consistent with the benchmarks set forth in the ANDS. 326 INL reported that JSSP Advisors, through the JSSP program, mentored provisional chief prosecutors and criminal investigation divisions in 15 provinces throughout Afghanistan. 327 Figure 3.42 shows the provinces in which Afghan judiciary members receive mentoring and training support. TABLE 3.8 INL JUSTICE AND RULE OF LAW PROGRAMS ($ MILLIONS) Program Name Description Funds Allotted JSSP Supports the Afghan justice sector $132.5 CSSP Supports the Afghan corrections system, $88.4 including training with MOJ and Central Prisons Directorate Counter-narcotics Justice and Supports CJTF, Anticorruption Unit, and CNT $7.0 Anticorruption Justice Integration Supports local and national NGOs including U.S. $2.0 Institute of Peace Judicial Security Supports improvements to judicial security for $2.0 CNT and to assist MOJ Justice Trust Fund Support Provides salary support for justice sector $10.0 Legal Education and Access to Supports additional education of Afghan legal $5.0 Justice professionals and the Afghan general public on developments in the Afghan legal sector Justice Infrastructure Supports development of justice sector infrastructure $10.6 Corrections Infrastructure Supports development of corrections system $15.0 infrastructure Total $272.5 Notes: Numbers affected by rounding. INL funding terms (allotted) reported as provided by INL except as specified. Sources: INL, responses to SIGAR data call, 7/2/2009 and 7/7/ SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

85 GOVERNANCE Consistent with programs established to improve the rule of law, Afghanistan is committed to rehabilitating its justice infrastructure (such as prisons), including erecting separate facilities for women and juveniles. 328 According to DoD, Afghanistan s prison population increased by 21% in The United States is considering a prison reform strategy, drafting standard operating procedures, and reviewing prisoners sentences and conditions to ensure that prisoners rights are protected. 330 After a review of more than 4,000 prisoners case files, 89 inmates were identified as eligible for release. 331 USAID reported that most Afghans believe corruption exists in the formal justice system and have little confidence in justice being properly adjudicated. 332 Instead of resolving conflict through the formal judicial system, some Afghans, particularly those who reside outside city limits, use community dispute resolution venues such as local tribunals. 333 FIGURE 3.42 INL JSSP, MENTORING PRESENCE BY PROVINCE UZBEKISTAN TAJIKISTAN CHINA TURKMENISTAN JOWZJAN BALKH KUNDUZ BADAKHSHAN HERAT FARYAB BADGHIS GHOR SAR-E PUL SAMANGAN BAMYAN WARDAK DAYKUNDI GHAZNI BAGHLAN PARWAN TAKHAR KAPISA NURISTAN KUNAR KABUL NANGARHAR PAKTIYA KHOWST LOGAR PANISHIR LAGHMAN FARAH URUZGAN ZABUL PAKTIKA Mentoring Presence IRAN NIMROZ HELMAND KANDAHAR PAKISTAN Source: INL, response to SIGAR data call, 7/2/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

86 GOVERNANCE RULE OF LAW Since 2002, the U.S. Congress has appropriated $76 million for programs to strengthen rule of law in Afghanistan. 336 Table 3.9 depicts the status of DEA funds appropriated. Counter-narcotics Rule of Law Counter-narcotics rule-of-law initiatives are divided between interdiction and law enforcement (which supports training and support programs for police and other law enforcement) and justice reform and prosecution (which works to enhance the Afghan justice system and its capabilities). 337 Interdiction Programs:work to develop Afghanistan s ability to arrest and prosecute command-and-control elements of drug organizations; this will support Afghanistan s capacity to disrupt and dismantle drug traffi cking organizations. 334 Law Enforcement Programs:work to enhance Afghanistan s capacity to arrest, prosecute, and process drug traffi ckers and corrupt offi cials. 335 Interdiction and Law Enforcement INL reported that the United States provides approximately $200 million per year in support to counter-narcotics interdiction and law enforcement through DoD, DEA, and INL. 338 Operation Data and Intelligence Collection and Exchange In 2008, Operation Data and Intelligence Collection and Exchange (DICE) tracked the movement of a precursor chemical for heroin acetic anhydride across Europe, East Asia, and the Middle East. Operation DICE identified trafficking patterns, uncovering previously unknown sources and trading countries. 339 INL reported that the GIRoA identified acetic anhydride as having no legitimate use in the country. 340 Plant-based drugs, including cocaine, morphine, and heroin, require precursor chemicals (chemicals mixed with the plants to TABLE 3.9 DEA FUNDS, FY ($ MILLIONS) Appropriation Actual Obligated Disbursed FY 2002 $0.58 $0.58 $0.58 FY 2003 $2.87 $2.74 $2.74 FY 2004 $3.72 $3.27 $3.27 FY 2005 $16.77 $12.30 $12.30 FY 2006 $23.66 $21.27 $21.08 FY 2007 $15.79 $15.79 $10.26 FY 2007 (Supplemental) $4.59 $4.89 $4.72 FY 2008 $18.20 $13.28 $8.97 FY 2008 (Supplemental) $22.39 $12.73 $9.17 FY 2009 $18.80 $6.62 $3.35 Total $ $93.47 $76.44 Notes: This table represents funding from FY 2001 through FY Numbers are affected by rounding. DoJ-DEA funding terms (actual, obligated, and disbursed) reported as provided by DoJ except as specified. Source: DoJ, response to SIGAR data call, 7/7/ SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

87 GOVERNANCE create drugs) for production. The U.S. counter-narcotics strategy includes targeting illicit commercial use of precursor chemicals. 341 According to INL, regulation of precursor chemicals such as acetic anhydride is considered a serious challenge for Afghanistan because Afghanistan is the source of 93% of the world s opium poppies and the location of an increasingly high percentage of heroin production. 342 ANTICORRUPTION EFFORTS Afghanistan faces many challenges in combating corruption in multiple facets of its reconstruction efforts, such as implementing strategies for training security forces, promoting democracy through free and fair elections, and fostering economic development through legal means. 343 According to the Afghanistan Compact and the ANDS, anticorruption is a key cross-cutting issue. 344 As shown in Table 3.10 the ANDS describes the GIRoA s commitment to controlling corruption using the Afghanistan Compact anticorruption benchmarks. Specifically, the GIRoA recognizes that corruption in the judicial, financial management, and service-delivery responsibilities of government significantly affects the power of government in a fundamental way. 345 USAID defines corruption as the abuse of public position for private gain. 346 USAID reported that pervasive corruption in Afghanistan undermines successful implementation of security, economic development, and state- and democracybuilding initiatives. 347 Finding a delicate balance between diverse local practices and preventing widespread corruption is imperative for establishing the GIRoA s authority, according to USAID. 348 The past 30 years of international and regional conflicts have destabilized Afghanistan s government institutions and fragmented the country. Existing anticorruption laws need to be strengthened to define the conduct that is prohibited and the associated punishment, as a deterrent. For example, USAID noted that TABLE 3.10 ANDS ANTICORRUPTION BENCHMARKS Target Date Cross-cutting issue Benchmark End 2010 Anticorruption In accordance with Article 50 of the Constitution, citizens will have unlimited right of access to information from GIRoA offi ces. End 2010 Anticorruption The GIRoA will increase the number of arrests and prosecutions of drug traffi ckers and corrupt offi cials. End 2013 Anticorruption The GIRoA will signifi cantly reduce corruption in the judiciary and government in the areas of security, customs, civil administration, and municipalities. The United States, our international partners, and most importantly, the Afghans, must work to reduce corruption and strengthen the rule of law. Without real progress on these issues, success will be very difficult to achieve. AFGHANISTAN NATIONAL DEVELOPMENT STRATEGY (ANDS) REGIONAL COOPERATION COUNTER-NARCOTICS ANTICORRUPTION GENDER EQUALITY CAPACITY ENVIRONMENTAL U.S. Ambassador to Afghanistan Karl W. Eikenberry 353 SECURITY DEVELOPMENT GOVERNANCE Source: GIRoA, The Afghanistan National Development Strategy, 6/2008, p. 72. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

88 GOVERNANCE The Capacity Development Program works closely with the minister of fi nance and the Independent Administrative Reform and Civil Service Commission to modernize fi - nancial and human resource management. The Offi ce of the President/Support for the Center of Government (OoP/SCoG) supports basic public-administration capacity development throughout the OoP for fi nancial management, information technology, and other critical capacity development. The Afghanistan Rule-of-Law Program (AROLP) provides training for more than 1,000 judges; support for development of systems for case management, tracking, and open information for courts; and support for developing a code of ethics for judges. 354 the Law on the Campaign against Bribery and Official Corruption fails to define prohibited conduct, such as bribing, illegally recommending, requesting, and lobbying. 349 USAID reported that the GIRoA needs to strengthen the application, coordinate and streamline certain provisions, and modify the practices of its existing anticorruption laws and policies to prevent corruption. 350 Anticorruption Programs USAID assists the GIRoA in its effort to strengthen the transparency, accountability, and effectiveness of the critical functions of Afghanistan s national and sub-national governments. 351 According to USAID, efforts to circumvent corruption are directed to core governance and rule-of-law capacity programs dedicated to improving transparency and accountability within the critical aspects of government. 352 The Capacity Development Program, Office of the President/ Support for the Center of Government (OoP/SCoG), and the Afghanistan Rule-of- Law Program (AROLP) are designed to foster transparency, accountability, and effectiveness in circumventing corruption activities. 355 USAID identified other U.S. government agencies that also provide substantive assistance to supporting Afghanistan s anticorruption efforts. 356 DoS, through its Economic Section, provide policy guidance to the central ministers in developing and strengthening the GIRoA s anticorruption efforts. USAID reported that the political and political-ministry sections of DoS work closely with Afghan ministries and the National Assembly in addressing anticorruption issues. 357 The U.S. Treasury (Treasury), according to USAID, also has provided mentoring support to MOF in providing public financial management reform to ensure transparency in the use of public funds. 358 With assistance from INL, the Anticorruption Unit (ACU) in the AGO was established. 359 According to INL, the ACU is a 15-member team of investigative prosecutors specially selected by the Attorney General to investigate and prosecute corruption cases nationwide. 360 The JSSP Advisors and the INL-funded DoJ prosecutors provide mentoring services. 361 The Attorney General has teamed with the international community to develop a new vetting process for current and future prosecutors in the ACU. 362 High Offi ce of Oversight for the Implementation of the Anticorruption Strategy The High Office of Oversight for the Implementation of the Anticorruption Strategy (HOO) opened its Kabul headquarters in July According to USAID, establishing HOO a new, dedicated anticorruption agency is a significant achievement for the GIRoA. 364 In this capacity, HOO will focus its resources on preventing corruption as well as disseminating more information to the public relating to the processes and costs of government ministries and departments SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

89 GOVERNANCE According to the UN Secretary-General, one of HOO s primary responsibilities is to host regular meetings with the president, the Supreme Court, the Attorney General, and MOJ. 366 USAID reports that, as a relatively new organization, HOO will be responsible for oversight and reporting for the Afghan government using guidance articulated in the UN Convention against Corruption (UNCAC). 367 According to USAID, HOO is responsible for the following functions: strategy oversight prevention complaints case tracking asset registration public outreach USAID provides technical assistance to HOO for institutional establishment and provides staff training and other assistance to prevent corruption within HOO. 368 According to USAID, efforts to combat corruption in Afghanistan target core governance and rule-of-law capacity development. 369 The GIRoA, through its ministries and agencies, will collaborate with HOO to identify areas of vulnerability to corruption and methods to promote integrity. 370 HOO s mission, according to USAID, will be focused on orchestrating Afghanistan s anticorruption efforts in a sustained and coordinated fashion. 371 SIGAR plans to assess the capabilities and the performance of HOO as part of its oversight activities. The UN Convention against Corruption (UN- CAC), enacted on September 29, 2003, set forth a detailed, comprehensive, and multidisciplinary approach for the prevention, investigation, and prosecution of systemic corruption. The UNCAC includes 71 articles addressing topics such as public reporting, preventing money-laundering, and criminal enforcement. It also recommended preventive anticorruption policies and practices that a sovereign nation can implement through its own governance mechanisms. 372 REPORT TO THE UNITED STATES CONGRESS I JULY 30,

90 GOVERNANCE The ANDS strategic objective is to enable the private sector to lead Afghanistan s development within a competitive market-based economy in which the Government is the policy maker and regulator of the economy, not its competitor. Afghanistan National Development Strategy: Economic and Social Development 82 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

91 ECONOMIC AND SOCIAL DEVELOPMENT ECONOMIC AND SOCIAL DEVELOPMENT OVERVIEW According to the Afghanistan National Development Strategy (ANDS), privatization and foreign investment are critical to economic and social development in Afghanistan. Other areas of focus include reliable access to electricity, water resource management, and safe and integrated transportation. 373 This section focuses on progress in Afghan economic and social development, highlights Afghan counter-narcotics efforts, and provides an update on provincial reconstruction teams (PRTs). Despite U.S. and other international investments in development programs, Afghanistan continues to face large-scale economic challenges. Living standards in Afghanistan remain among the lowest in the world. 374 Investment is deterred by weak institutions and enforcement. 375 In addition, the drug trade continues to inhibit all attempts by the Government of the Islamic Republic of Afghanistan (GIRoA) to enhance development initiatives and stability. 376 KEY ECONOMIC INDICATORS The ANDS stresses the importance of bolstering the economic development of Afghanistan. Some key indicators for that development include an effective banking system, a growing gross domestic product (GDP), a steady currency, and low unemployment. Banking In 2004, the GIRoA legislature passed a banking law, formalizing the Afghan banking structure. Since then, banking assets have increased steadily. As of March 2009, the U.S. Treasury (Treasury) estimated that banking assets were approximately $2.41 billion, and capital totaled approximately $355 million. In the past year, banking assets have increased by 66% and deposits have increased by 69%. 377 The Afghan banking system includes two state-owned banks, eight Afghanowned banks, and seven foreign-owned banks. The three largest banks are Kabul, Azizi, and Pashtany. These three banks account for more than 50% of Afghan banking assets. Kabul and Azizi are both privately owned, and Pashtany is a state-owned bank. 378 AFGHANISTAN NATIONAL DEVELOPMENT STRATEGY (ANDS) REGIONAL COOPERATION COUNTER-NARCOTICS ANTICORRUPTION GENDER EQUALITY CAPACITY ENVIRONMENTAL DEVELOPMENT GOVERNANCE SECURITY The under-development of the banking sector, combined with high banking commission rates, have discouraged Afghans from using formal banking channels, according to the United Nations (UN). In the absence of a developed banking structure, many Afghans rely on hawala, an informal fi nancial system, to move money domestically and abroad. 379 Practitioners of hawala (known as hawaladars) are based primarily in Kabul, at the money market exchange. The hawaladars provide customers with fi nancial services including money exchange transactions, funds transfers, micro-fi nance, trade fi nance, and deposit taking. They also provide traders with fi nancial services, such as currency conversions, international and domestic money transfers, and deposit-taking services. 380 Treasury reports that several domestically owned banks in Afghanistan have a background in hawala. 381 REPORT TO THE UNITED STATES CONGRESS I JULY 30,

92 ECONOMIC AND SOCIAL DEVELOPMENT Solar Calendar: Each solar year (SY) starts on March 22 and lasts until March 21 the following year. By the solar calendar, July 2009 falls within SY FIGURE 3.43 COMPARISON OF SOLAR YEAR TO GREGORIAN CALENDAR YEAR 2009 TABLE 3.11 July Solar Year Solar Year begins begins March 22, March 22, Source: USAID, response to SIGAR data call, 7/2/2009. In Afghanistan, licit GDP acknowledges the existence of a large illicit (illegal) revenue, especially through poppy production. 383 The Afghan central bank, Da Afghanistan Bank, operates on the solar calendar timeframe, while commercial banks use the Gregorian calendar, which is commonly used by U.S. and international commercial financial institutions and central banks. Da Afghanistan Bank had planned to coordinate a unified timeframe for the Afghan banking system by June 2008 but has determined it would be impractical. The International Monetary Fund (IMF) reported that the central bank has reached an understanding with commercial banks to collaborate on key data points. 384 Figure 3.43 shows the overlap between solar and Gregorian calendar years. Gross Domestic Product Both real and nominal GDP in Afghanistan are expected to experience growth in Treasury reported that estimates of Afghanistan s GDP vary widely, primarily because of data limitations within the country. Treasury uses the IMF s GDP estimates to track GDP spending. Services, including financial and telecommunications companies, are the largest contributors to GDP. Agricultural production (including wheat) is the second-largest provider, followed by the manufacturing industry. 385 Table 3.11 shows both nominal and real GDP estimates between 2002 and GDP does not account for the sizable opium-production industry; some estimates indicate the opium trade could be as large as the licit economy. 386 Stability of Afghan Currency Afghanistan s currency is the Afghani (AFA). 387 As of July 1, 2009, Da Afghanistan Bank reported the exchange rate at approximately 50 AFAs to one U.S. dollar. 388 The IMF reported that the AFA remained broadly stable throughout 2008; it depreciated slightly as compared with the U.S. dollar but appreciated in tradeweight terms. Da Afghanistan Bank has tried to maintain the value of the AFA by fostering the market for capital notes and establishing an electronic registry. 389 Employment The ANDS states that in order to reduce the high poverty rate in Afghanistan, the country will have to make progress toward increasing employment opportunities. 390 In 2008, Afghanistan s unemployment rate was estimated to be 40%, one of the highest in the world; out of 199 ranked countries (1 being the lowest unemployment rate), Afghanistan ranked AFGHANISTAN GDP GROWTH ESTIMATES 2002/ / / / / / / /10 Nominal GDP ($ billions) Real GDP Growth (% change, year on year) Notes: Numbers are affected by rounding. Both 2008/2009 and 2009/2010 numbers are estimates. Source: U.S. Treasury, response to SIGAR data call, 7/10/ SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

93 ECONOMIC AND SOCIAL DEVELOPMENT From a labor force of approximately 15 million Afghans, 80% are employed in agriculture, 10% in industry, and 10% in services. 392 ESSENTIAL SERVICES Energy The main ANDS goals for the energy sector include the construction of a reliable, affordable energy system and increased privatization with oversight by the GIRoA. With these goals in mind, the ANDS anticipates the next steps in energy development will be the expansion of services and maintenance of competitive pricing for all but the poorest customers. The expansion process will be the responsibility of donor-funded projects, while the privatization will be the responsibility of the GIRoA. 393 The United States has provided support for energy development through the Economic Support Fund (ESF), managed by the U.S. Agency for International Development (USAID), and the Commander s Emergency Response Program (CERP). 394 Several large-scale electricity projects are under way, including the expansion of the North-East Power System, 395 the Kabul Power Plant, 396 and a $3.75 million award to support data and technical assistance to the Ministry of Energy and Water. In addition, the Darunta Hydroelectric Power Plant Rehabilitation (supported with $9.86 million in U.S. funds), is in progress for Nangarhar Province. 397 A recent agreement with neighboring Uzbekistan has allowed for the completion of an electric transmission line across the northern border of Afghanistan. With this line completed, the United Nations (UN) Secretary General reported a nearly full restoration of power to parts of Kabul. 398 Education With support from international donors, the GIRoA has reported improved access to education throughout Afghanistan. In 2008, approximately 52,200 students were involved in higher education, and approximately 6 million children attended school, 399 including almost 2 million girls. Under the Taliban, fewer than 1 million children were in school and girls were not permitted to attend. 400 With the influx of students into Afghan schools, the ANDS goals focus on increasing the quality of available education. To support this goal, increased teacher training and support are planned within the educational structure. 401 During the Taliban regime, approximately 80% of Afghan schools were damaged or destroyed. The United States has supported the construction and refurbishment of more than 680 schools in Afghanistan. Through USAID, more than 60 million textbooks have been distributed. 402 REPORT TO THE UNITED STATES CONGRESS I JULY 30,

94 ECONOMIC AND SOCIAL DEVELOPMENT Water The ANDS stresses the need for improved efficiency in water management as a crucial component of development in the water sector. As such, the ANDS recommends a departure from project-by-project work toward an integrated water resources management (IWRM) program, which will focus on improved storage facilities, recharge basins, multi-purpose dams, and irrigation systems. 403 Since the release of the ANDS, Afghanistan has developed an IWRM that outlines a series of detailed goals for the water sector. USAID reported that IWRM is an internationally accepted approach to water development programming. Afghan IWRM priorities include: 404 development of multi-purpose dams, which provide irrigation systems, flood control, water supplies, and power improvement of rural, municipal, and urban water supplies, and sanitation systems At a June 2009 donor conference in Paris, the GIRoA presented a $5.3 billion spending plan for its water sector. 405 The United States continues to provide support for Afghan water and sanitation development. 406 Although there has been some progress in providing water to the Afghan people, less than a fourth of the population has continuous access to potable water. Since 2001, the UN Children s Fund (UNICEF) has reported steady improvements in the delivery of clean water. People living in remote areas, however, continue to have trouble gaining access to safe water. 407 The lack of sewer systems and sanitation affects more than health; it also can affect educational opportunities. According to UNICEF, a lack of gender-specific latrines prevents many girls from attending school. UNICEF is supporting the GIRoA s efforts to provide schools with access to drinking water and genderspecific latrines. 408 An Afghan man receives medical treatment at a medical capabilities (MEDCAP) health cooperative. (U.S. Marine Corps photo) Health Care USAID has defined the health status of Afghans as among the worst in the world, 409 and the ANDS states that by all measures, the people of Afghanistan suffer from poor health. 410 The ANDS identifies a list of challenges to the health of the Afghan people: 411 insufficient funding for key programs limited sustainability plans when donor funding is completed insufficient training for health workers limited qualified female health workers for rural areas large rural population with limited accessibility to health care facilities under-utilization of health services, especially preventive services inconsistent levels of health care service quality security concerns in some provinces preventing safe access to health care limited infrastructure to provide low-cost health care for poor households limited infrastructure to support and regulate private-sector pharmacy care 86 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

95 ECONOMIC AND SOCIAL DEVELOPMENT The GIRoA is focusing on specific challenges described in the ANDS. They include reducing the maternal mortality rate by 15%, reducing the under-5 mortality rate by 20%, and reducing the infant mortality rate by 20% from 2000 levels. 412 USAID reports that two of the three goals (mortality rate goals for under-5 and infants) have been achieved, 413 and overall health conditions for Afghans are improving. 414 Between 2001 and 2007, tuberculosis case detection rates doubled (from 29% in 2001 to 64% in 2007). 415 Table 3.12 shows some of the indicators of improvement. USAID reports that all Afghan provinces currently have access to health care; however, many rural areas are still between two and four hours walk from medical care. The internationally recognized travel distance for adequate access to health care is two hours or less. 416 Table 3.13 depicts ways USAID is supporting development in the health care sector. In addition to USAID projects, Afghanistan s health care sector receives U.S. support from the Department of Health and Human Services (HHS) and the Department of Defense (DoD). Additional health care funding is provided by the World Bank, the European Commission, the Japan International Cooperation Agency (JICA), the French government, the Asian Development Bank, the Italian government, privately funded non-governmental organizations (NGOs), and other international governments through provincial reconstruction teams (PRTs). 417 For more on PRTs, see the PRT discussion in this section. TABLE 3.12 IMPROVEMENT INDICATORS FOR HEALTH CARE IN AFGHANISTAN ANDS Objective Improvement Indicator as of July 2009 Between 2003 (SY 1982) and 2015 (SY 1394), under-5 mortality will drop 50%. By March 2010 (end of SY 1389), infant mortality will drop 20%. By March 2010 (end of SY 1389), 90% of Afghans will have access to health care. By March 2010 (end of SY 1389), 100% of under-5 children will be vaccinated against vaccine-preventable diseases. Under-5 mortality has dropped 26% (191 deaths per 1,000 live births). Infant mortality has dropped 22% (129 deaths per 1,000 live births). More than 80% of Afghans have access to health care, compared with 8% in More than 90% of children under 5 have been vaccinated against polio. The Japan International Cooperation Agency (JICA):is an international development group working with developing nations including Mexico, Pakistan, Turkey, and Afghanistan. 418 The Asian Development Bank is an international development fi nance institution supporting poverty eradication and qualityof-life programs for developing countries in Asia and the Pacifi c. 419 Sources: GIRoA, Afghanistan National Development Strategy, 6/2008, pp ; USAID, response to SIGAR data call, 7/2/2009; USAID, response to SIGAR vetting, 7/16/2009; USAID, USAID: Afghanistan, accessed 6/9/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

96 ECONOMIC AND SOCIAL DEVELOPMENT TABLE 3.13 USAID ONGOING SUPPORT FOR HEALTH CARE PROGRAMS IN AFGHANISTAN Activity Polio Eradication Project Capacity Development for the Private Health Care Sector (COMPRI-A) Tech-Serve Health Services Support Project (HSSP) Description USAID supports UNICEF s Polio Eradication Project, which coordinates national immunization days and door-to-door vaccinations for children. This project is ongoing. In 2006, more than 7 million children received polio vaccinations. USAID supports the Communication for Behavior Change: Expanding Access to Private Sector Health Products and Services in Afghanistan (COMPRI-A) Project, which works to increase health care capacity through public information, increased access to reproductive health care and child survival, and coordination between private and public health services. USAID s Tech-Serve program works to bolster the Ministry of Public Health management information system. The program aids the Ministry of Public Health in monitoring its health clinics and provides assistance in ordering and delivering medicines used by more than 350 health clinics and 3,800 health posts. HSSP assists non-governmental organizations (NGOs) in implementing services to improve management at Afghan health clinics. The goals of the project include improving systems that support service delivery quality; increasing the number of health care providers, especially for women in rural and underserved areas; and supporting positive health care behavior in Afghan families and communities. Estimated Start Completion Dates Ongoing 2/2006 3/2010 7/2006 6/2010 7/2006 9/2010 Source: USAID, Programs: Health, accessed 7/3/2009. Transportation The main transportation goal described by the ANDS requires that Afghanistan build and maintain a safe, integrated transportation network within the country. The transportation system should be low-cost and fairly reliable to encourage the movement of people and goods. The ANDS also adopted three milestone transportation goals from the Afghanistan Compact: 420 The Ring Road: A well-maintained, modern road system throughout Afghanistan, including connecting roads leading out of the country, and a sustainable road maintenance system by SY 1387 ( ) Airport Reconstruction: Full International Civil Aviation Organization compliance for Kabul International Airport and Herat Airport, as well as runway repairs and upgrades for regional airports by SY 1389 ( ) Border Management: A series of trade and transit agreements with neighboring countries, making it easier to move between Afghanistan and bordering nations by SY 1389 ( ) Pavement is laid on the Kabul-Kandahar Road, part of the Ring Road. (USAID photo) USAID is overseeing the Ring Road project, which is working to rehabilitate the Afghan roadway system. When completed, approximately 60% of Afghans will live within 50 km of the Ring Road. 421 As of September 2008, more than 1,650 miles of road had been constructed or rehabilitated with support by USAID. 422 According to USAID, the following contributions were pledged to support the national Ring Road system: 423 Japan: contributing funds for 116 km Saudi Arabia: contributing funds for 115 km United States: contributing funds for 326 km and security, de-mining, design, and construction management for Saudi Arabia s 115 km 88 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

97 ECONOMIC AND SOCIAL DEVELOPMENT In June 2009, Bost Airstrip was opened as the only commercial airstrip in southern Afghanistan. Located in Helmand Province, Bost Airstrip is 2,000 m in length and will primarily support light aircraft; it previously served as a military airstrip. Commercial passenger aircraft were expected to start using Bost Airstrip in July The airstrip was constructed by USAID in partnership with the Afghan Ministry of Transportation and Civil Aviation (MoTCA). 424 As of 2008, Afghanistan had 50 airports, including 14 with paved runways and 36 with unpaved runways. 425 HELMAND PROVINCE Location of Bost Airstrip INDUSTRY GROWTH Afghanistan s industry is based primarily on agriculture. In addition to subsistence crop production, Afghanistan grows food crops for commercial use, including wheat, grapes, apricots, and pomegranates, and industrial crops, including cotton, tobacco, madder, castor beans, and sugar beets. Afghanistan also has many natural resources, including natural gas, petroleum, coal, and copper; however, instability in the country and rugged terrain have made it difficult to exploit these resources. 426 Agriculture The main agricultural goal for Afghanistan, as defined by the ANDS, is to use development in this sector to create a livelihood for the rural poor. 427 An estimated 80% of Afghans make their living through farming or herding. Approximately 12% of Afghanistan s land is arable, but only 6% is currently cultivated. 428 The ANDS provides a two-part strategy to develop the agriculture sector: the Comprehensive Agriculture and Rural Development (CARD) initiative, and the Agricultural and Rural Development Zone (ARDZ). The CARD initiative is focused on reducing poverty through economic regeneration 429 and private-sector development by enabling farmers and agribusiness. 430 CARD priorities are varied, depending on regional needs, but the overall theme is to support the most impoverished and vulnerable part of Afghanistan: the rural poor. The ARDZ represents the GIRoA s strategy to expand commercial activities to improve agricultural productivity. 431 The United States provides support for provincial efforts to improve agricultural development. In April 2009, construction began on the Helmand Agriculture Center, an agribusiness industrial park supported by USAID. Located in the southern province of Helmand, the center is expected to create approximately 2,500 jobs in manufacturing, processing, services, and site maintenance. 432 Source: UNODC, World Drug Report 2009, 6/24/2009. NATURAL GAS IN AFGHANISTAN Between 1967 and 1989, natural gas sales accounted for approximately $300 million in annual exports revenue about 56% of overall Afghan exports; however, approximately 90% of this revenue was used to pay import costs and debts to the Soviet Union. In 1989, when Soviet troops withdrew from Afghanistan, the natural gas fi elds were capped in an attempt to prevent sabotage by the mujahedeen. Regional instability and the loss of trading partners following the collapse of the Soviet Union have made it diffi cult for Afghanistan to reactivate the fi elds, as reported by USDA in January REPORT TO THE UNITED STATES CONGRESS I JULY 30,

98 ECONOMIC AND SOCIAL DEVELOPMENT Drought Below-normal rainfall and snowfall in the winter of resulted in a serious drought for Afghanistan. The drought impaired wheat seed availability, causing wheat production to fall by 55% from the previous year and barley production by 67%. 433 Despite UN and GIRoA efforts to control price inflation, the U.S. Department of Agriculture (USDA) reported that wheat prices climbed to an average of 200% higher than normal levels in most Afghan markets. 434 Although Afghanistan has a sufficiently varied agricultural economy to accommodate the shortage of wheat, USAID reports that the loss of a staple grain product caused concern that civil unrest might arise without access to wheat. With consideration for the upcoming presidential election, the GIRoA and international donors provided extra support to bolster wheat production. USAID provided $60 million for agricultural vouchers for increased production in Afghanistan. Estimates indicate the next wheat crop will be the highest of the past 30 years. 435 LOGAR PROVINCE Location of Aynak Copper Mining Source: UNODC, World Drug Report 2009, 6/24/2009. Mining The ANDS goal for the mining sector is to encourage private investment and development. The anticipated results of mine industry growth include increased government revenue and improved employment opportunities. To encourage privatization, the ANDS expects the Afghan Ministry of Mines (MOM) to transition from a producer of products to an overseer of private industry. 436 However, as of July 8, 2009, the ministry still described itself as involved in the research, exploration, development, exploitation, and processing of minerals and hydrocarbons. 437 In May 2008, MOM signed a contract with China to allow the mining of Aynak copper. Through negotiation, the ministry was able to convince China to agree to conduct exploration, exploitation, process, smelting, and cathodic infiltration within the borders of Afghanistan, instead of transporting the raw product back to China for processing. According to MOM, this contract will keep expertise in the country and provide increased infrastructure in the mined province (Logar), which, in turn, will encourage the development of primary and secondary schools and regional markets. 438 The ANDS states that it is crucial for MOM to use the Aynak copper contract to attract further investment in the mining sector SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

99 ECONOMIC AND SOCIAL DEVELOPMENT COUNTER-NARCOTICS The ANDS recognizes counter-narcotics as a cross-cutting issue, meaning that it infiltrates all three pillars of reconstruction: security; governance, rule of law, and human rights; and economic and social development. Counter-narcotics programs are designed to promote four goals: 440 disruption of the drug trade strengthening and diversification of legal rural livelihoods reduction of demand for illicit drugs and improved treatment for drug addicts and users strengthening of government institutions to fight drugs According to the U.S. Government Accountability Office (GAO), The drug trade has undermined virtually every aspect of the Afghan government s effort to build political stability, economic growth, rule of law, and its capacity to address internal security problems. 441 Illegal trafficking also provides funding for the Taliban and other anti-government groups. 442 Afghanistan continues to produce more than 90% of the world s opium through the cultivation of poppies. 443 Poppies are the source of opium, a key ingredient in heroin and multiple other opioids, including morphine. 444 As of 2008, approximately 2.4 million Afghans were involved in opium production about 10% of Afghanistan s population. 445 According to the U.S. Department of State (DoS) Bureau of International Narcotics and Law Enforcement (INL), if opium were a legal product, it would have made up approximately 7% of Afghanistan s 2008 GDP a significant drop from 2007 (12%). 446 Table 3.14 shows the change in opium farm-gate value in the past three years. Approximately 98% of poppy cultivation is concentrated in the southern provinces, where the Taliban and insurgency continue to hold sway. 447 The UN Office of Drugs and Crime (UNODC) estimates that 22 Afghan provinces will be poppyfree in 2009 an additional four provinces from 2008 (Badakhshan, Baghlan, Faryab, and Herat). 448 A province is defined as poppy-free when it has fewer than 100 hectares (ha) of land used in opium cultivation. 449 Figure 3.45 shows poppy cultivation across Afghan provinces. AFGHANISTAN NATIONAL DEVELOPMENT STRATEGY (ANDS) REGIONAL COOPERATION COUNTER-NARCOTICS ANTICORRUPTION GENDER EQUALITY CAPACITY ENVIRONMENTAL SECURITY DEVELOPMENT GOVERNANCE Farm-gate value:refers to the value of the product before shipping, or at the farm s gate. One hectare (ha):is equivalent to approximately acres of land. 450 According to INL, no legal poppy farms exist in Afghanistan. 451 TABLE 3.14 OPIUM PRODUCTION IN RELATION TO AFGHAN GDP Year Licit GDP Total Farm-Gate Value Opium Farm-Gate Value as a Percentage of GDP 2008 $10.2 billion $730 million 7% 2007 $8.2 billion $1.0 billion 12% 2006 $6.9 billion $0.76 billion 11% Source: DoS, response to SIGAR data call, 7/2/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

100 ECONOMIC AND SOCIAL DEVELOPMENT FIGURE 3.45 POPPY CULTIVATION LEVELS BY PROVINCE UZBEKISTAN TAJIKISTAN CHINA TURKMENISTAN JOWZJAN BALKH KUNDUZ TAKHAR BADAKHSHAN HERAT BADGHIS FARYAB GHOR SAR-E PUL SAMANGAN GHAZNI BAGHLAN PARWAN BAMYAN KABUL WARDAK DAYKUNDI LOGAR PANISHIR KAPISA PAKTIYA NURISTAN LAGHMAN KUNAR NANGARHAR KHOWST F ARAH URUZGAN ZABUL PAKTIKA Considered Poppy-Free Very Low IRAN NIMROZ HELMAND KANDAHAR Low PAKISTAN Moderate High Very High Source: UNODC, "World Drug Report 2009," 6/24/2009, p FIGURE 3.44 AFGHAN POPPY CULTIVATION BY YEAR (THOUSANDS OF HECTARES) Note: Numbers affected by rounding and are UN estimates. Source: UNODC, World Drug Report, 6/24/2009. In 2008, Afghan opium production dropped 19% from the previous year, as reported by UNODC. 452 Figure 3.44 depicts opium production year by year between 2002 and U.S. Efforts in Counter-narcotics As of July 2, 2009, the United States had the largest international counternarcotics footprint in Afghanistan. 453 In FY 2009, the United States expended almost $172 million for Afghan counter-narcotics efforts. 454 Alternative Development Programs According to INL, alternative development programs seek to encourage mainstream economic and political growth outside of poppy production, either through the production of alternative crops or with non-agricultural labor. 455 USAID reported that improved availability of off-farm jobs and opportunities to sell legal crops increase the likelihood that farmers will shift away from growing poppies SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

101 ECONOMIC AND SOCIAL DEVELOPMENT Approximately $8.5 million has been allotted to INL for alternative development programs. INL has expended almost all of those funds ($8.45 million). 457 Some of the programs instituted to encourage alternative development include: 458 development of orchards and other perennial crops development of roads to increase rural access to markets improved access to storage facilities for crops increased enforcement of anticorruption efforts on roadways enhanced agricultural output processing (for example, grain mills to grind wheat into flour) development of agri-technology (for example, greenhouses to extend crop growing seasons) Table 3.15 describes the regional work USAID has done to promote alternative development. USAID is implementing a new alternative development program called Incentives Driving Economic Alternatives for North, East, and West (IDEA- NEW). The program will replace Alternative Development Programs North and East. USAID reported that IDEA-NEW is expected to focus on poppy-prone provinces in the east. Southern provinces are covered by a separate alternative development initiative, which received additional funding in July THE ROLE OF THE POPPY IN DRUG PRODUCTION Approximately one week after the opium poppy loses its fl ower petals, sap is produced in the fl owers seed pods; this sap is opium latex. The sap is allowed to dry (becoming opium gum) and then sold to an intermediary or directly to a traffi cker, who mixes it with chemicals to produce opium, morphine (either crude or partially purifi ed), heroin, or white heroin (heroin hydrochloride). Increasingly, drug production is done in country. 460 TABLE 3.15 REGIONAL USAID PROGRAMS IN COUNTER-NARCOTICS Regional USAID Program USAID Program Description Dates of Operation Status Alternative Development Program North (ADP North) Worked to shift the region s economy from illicit to licit agricultural 2005 February 2009 Complete production through assistance to current and potential opium poppy producers and communities. This USAID team focused on three main components: cash-for-work, formation of and support for sustainable enterprises (on-farm production, agro-processing businesses, and marketing support), and enhancing the investment environment in targeted areas with improved infrastructure (roads, bridges, irrigation systems, private/public institutional support and capacity building, and business services). The program gave special consideration to including women in project activities. Alternative Development Program Northwest Aims to combat the economic dependence of Balkh, Jawzjan, Farah, and Ghor on opium production, processing, and trade. Through this program, USAID hopes to help communities to create sustainable employment opportunities through legal means. Anticipated program goals include a bolstered infrastructure with increased local employment opportunities for landless laborers, poor farmers, widows, and others susceptible to opium production, processing, or trade; and increased opportunities for groups to start or expand local businesses; work for growing local enterprises; or raise farm or fi rm revenue through a range of marketing, processing, and business development improvements Ongoing Sources: DoS, response to SIGAR data call, 7/2/2009; USAID, response to SIGAR vetting, 7/16/2009. Continued on next page REPORT TO THE UNITED STATES CONGRESS I JULY 30,

102 ECONOMIC AND SOCIAL DEVELOPMENT TABLE 3.15 (CONTINUED) REGIONAL USAID PROGRAMS IN COUNTER-NARCOTICS Regional USAID Program USAID Program Description Dates of Operation Status Alternative Development Program East Provided support for accelerated regional economic growth and alternative 2005 March 2009* Complete income sources for those dependent on the poppy production industry in Nangarhar, Laghman, Kunar, and Nuristan provinces. USAID reported that this program made progress in meeting its objectives by supporting entrepreneurship in horticulture, livestock, staple crops, business services, gender and micro-enterprise, and capacity-building initiatives. The program placed particular emphasis on the creation of women-owned enterprises. *Program was extended to June 2009 to overlap with a new program started in March Alternative Development Program Southern Region Provides counter-narcotics services for Helmand, Kandahar, and Uruzgan provinces. USAID plans to rehabilitate 300 km of gravelcompacted farm-to-market roads; build 40 km of cobblestone roads; complete a 250-km irrigation canal improvement for 65,000 hectares of farmland; rebuild the Lashkar Gar electrical sub-station to improve electrical access for 8,000 families and businesses; establish 14 veterinary fi eld units; establish a commercial feed mill; distribute animal feed to more than 20,000 farmers and improved vegetable seeds to more than 30,000 farmers; and provide technical training for extension workers, para-vets, and farmer co-ops and associations Ongoing Sources: DoS, response to SIGAR data call, 7/2/2009; USAID, response to SIGAR vetting, 7/16/2009. Alternative development programs seek to overcome motivating factors for the opium trade. Some of the reasons farmers choose to grow poppies over other crops include: 461 ease of obtaining credit to grow crops ease of sale of product ease of storage (opium does not spoil) Poppy plants dry in Helmand Province. (U.S. Marine Corps photo, LCpl James Purschwitz) Additionally, poppy crops are low-risk. The crops are drought- and pest-tolerant, and drug lords have organized mutual assurance societies, providing farmers with insurance should poppy eradication teams destroy their crops. 462 INL points out that some farmers sell opium in addition to subsistence crops because the crop is easy to sell and highly lucrative, it provides the farmers with additional cash without inhibiting their ability to grow food crops. 463 A UNODC study released in January 2009 identified additional motivating factors. The survey asked village headmen in Afghanistan to identify their primary reasons for growing poppies. Across Afghanistan, UNODC reported that more than 50% of the headmen listed the higher sale price as their reason. Deterrents to growing poppies varied by location. In the southern and western regions where 98% of Afghanistan s opium poppies are grown, the rising price of wheat was the largest deterrent to poppy crops (22% of responders). In the other regions, more than 50% listed pressure from government authorities as their main deterrent SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

103 ECONOMIC AND SOCIAL DEVELOPMENT Public Information Public information projects focus on providing information to Afghans about counter-narcotics. Information campaigns and activities are conducted by the GIRoA with support from the United States. 465 Table 3.16 outlines some of INL s projects to discourage opium production and disbursement. Poppy Elimination and Eradication According to INL, poppy cultivation fell by 19% in 2008, after two years of record production. 466 The number of households involved in the opium trade fell by 28%, as reported by DoS. 467 INL attributed this decrease to several issues, including poor weather conditions, the falling value of opium relative to other crops, and improved governance and security. 468 INL reported that poppy eradication programming (in which poppy fields are sought out and destroyed) will be phased out in 2009, and resources will be focused on agriculture, interdiction, and public information programs. However, the United States will continue to support the Good Performers Initiative, which provides incentives to provincial governors and governments that are successful in reducing and eliminating poppy cultivation in their areas. 469 The United States will also continue to support Governor-led Eradication (GLE), which reimburses provincial governments for eradication of poppy crops. GLE reimbursements are made on the basis of poppy eradication that has been verified by the Afghan Ministry of Counter-narcotics and UNODC. In 2009, provincial governments were paid at the rate of $ per ha of verified eradicated crops. The United Kingdom has funded, and continues to fund, eradication efforts. 470 TABLE 3.16 U.S. PUBLIC INFORMATION PROJECTS IN AFGHANISTAN Program Type Description New Media In coordination with Voice of America (VOA), this program sends text messages and robo-calls with counter-narcotics messages and news updates to approximately 130,000 Afghan cell phone users. Broadcast Also in coordination with VOA, this program supports a twice-weekly radio news package on counter-narcotics. The broadcast is aired on various Afghan radio stations in both Dari and Pashtu, and also in spots on Afghan television. Direct Engagement Live Theater Source: DoS, response to SIGAR data call, 7/2/2009. This program supports Counter-narcotics Advisory Team (CNAT) initiatives in seven Afghan provinces (Helmand, Farah, Kandahar, Uruzgan, Balkh, Badakhshan, and Nangarhar). Each CNAT team is implementing counter-narcotics activities, including Mothers Against Drugs (MAD), an addicted women s sewing project, school visits and contests, and farmers workshops. This program operates with support from Equal Access. It provides Counternarcotics Mobile Theater, which travels between the seven CNAT provinces (listed above), performing dozens of live shows and conducting youth workshops. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

104 ECONOMIC AND SOCIAL DEVELOPMENT UNODC reported that opium cultivation in 2008 vastly outweighed world demand. With market prices responding slowly to economic conditions, UNODC believes a large percentage of opiates (including opium, heroin, and morphine) has been withheld from the market and is being stored somewhere. As part of poppy elimination and eradication, UNODC reported that these stockpiles are a time bomb for public health and global security. 473 Afghan Counter-narcotics Efforts In response to the continuing challenges of drug trafficking, Afghanistan established the Afghan National Drug Control Strategy, which focuses on eight areas of development: 474 public information outreach alternative development law enforcement justice sector reform demand reduction international and regional engagement institution building eradication These areas correspond to the ANDS pillars of security; governance, rule of law, and human rights; and economic and social development. 475 U.S.-managed PRTs:are interim organizations used to coordinate diplomatic, economic, reconstruction, and counterinsurgency efforts between the various U.S. agencies, such as DoS, DoD, and USDA in Afghanistan. 471 In 2002, the U.S.-led coalition established the fi rst PRTs in Afghanistan as part of Operation Enduring Freedom (OEF). PRTs initially supported security and reconstruction efforts throughout the provinces as well as efforts to build trust and confi dence among the local residents. Since then, the PRT mission in Afghanistan has expanded to include supporting local governance operations and improving community development. 472 International Counter-narcotics Efforts The United Kingdom and UN also are large-scale contributors to the counternarcotics effort. 476 In keeping with the Bonn Agreement, the United Kingdom was the leader in counter-narcotics assistance until In the past three years, the United Kingdom provided more than $480 million to rule of law and counter-narcotics programming in Afghanistan. This funding supported capacity development programming in the Ministry of Counter-narcotics, program planning and development, and equipment, including tractors and wheat seed. 477 The UN also has a large counter-narcotics presence in Afghanistan, especially through UNODC. On June 24, 2009, UNODC released its 2009 World Drug Report. 478 The report provided statistics on the progress made in Afghanistan this past year. 479 Since 2006, INL has contributed $7.94 million to UNODC for counter-narcotics-related projects in Afghanistan. 480 PROVINCIAL RECONSTRUCTION TEAMS (PRTs) PRTs were created to help improve stability in Afghanistan by increasing the GIRoA s ability to govern and deliver critical public services to Afghan citizens. 481 As of July 2009, there were 26 PRTs in Afghanistan, 12 of which are managed by the United States. 482 Table 3.17 provides an overview of PRTs across the country. 96 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

105 ECONOMIC AND SOCIAL DEVELOPMENT The International Security Assistance Force (ISAF) oversees the military component of all PRTs in Afghanistan and provides guidance; however, the civilian component of each PRT, including those managed by the United States, has discretion to develop the structure and size of its PRT support. 483 Most teams are composed of a PRT commander and at least one representative from DoS, USAID, and USDA. 484 Examples of PRT activities include development, reconstruction, monitoring, and reporting on ongoing projects and local conditions. 485 PRTs sponsor initiatives to support local development. For example, a growing number of PRTs are incorporating agribusiness development teams (ADTs) into their provincial work. 486 Members of ADTs are usually U.S. National Guardsmen, often from farm states, with experience in farming, livestock, and cultivating natural resources. ADT members use these skills to advise rural development initiatives. In Nangarhar Province, the ADT has more than 70 active projects with a value of approximately $5.6 million, including: 487 building grain mills introducing new wheat seed developing canning and juicing factories for harvested vegetables and fruits building cool-storage facilities to store harvested crops operated by solar panels overseeing micro-slaughter facilities to increase sanitization of livestock meat launching veterinary clinics focused on de-worming the livestock advising with reforestation projects increasing the crop yield for commercial use operating cold- and warm-water fish hatcheries TABLE 3.17 PRTs BY MANAGING COUNTRY PRT Run By Province Canada Kandahar Czech Republic Germany Germany Hungary Italy Lithuania New Zealand Norway Spain Sweden The Netherlands Turkey United Kingdom United States United States United States United States United States United States United States United States United States United States United States United States, supporting efforts by South Korea Logar Badakhshan Kunduz Baghlan Herat Ghor Bamyan Faryab Badghis Balkh Uruzgan Wardak Helmand Farah Ghazni Khowst Kunar Laghman Nangarhar Nuristan Paktika Paktiya Panishir Zabul Parwan Source: USAID, Provincial Reconstruction Teams, accessed 7/17/2009; ISAF, International Security Assistance Force: Facts and Figures, 6/15/2009. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

106 Paktiya Provincial Reconstruction Team U.S. Army Capt. Megan O Conner, a Paktiya PRT civil affairs team chief, reviews the plans for an addition to the new provincial prison during a visit to the site in Gardez City. (DoD photo, Fred W. Baker III)

107 4 OTHER AGENCY OVERSIGHT Introduction: The Year of Transfer Rise in Income Expanding Iraqi Security Authority Afghanistan Reconstruction Upda Afghanistan Audits Afghanistan Inspections Reconstruction Teams The Role of the International Com Anticorruption Efforts Security Security Conditions Still Hinder Reconstruction Activities Concerned Local Citizen Initiative Legislative Developments The Human Toll 99

108 100 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION 100

109 OTHER AGENCY OVERSIGHT OTHER AGENCY OVERSIGHT Each quarter, the Special Inspector General for Afghanistan Reconstruction (SIGAR) requests updates from other government agencies on the number of oversight activities completed and the number of ongoing oversight activities currently being performed. The following agencies are currently performing oversight activities in Afghanistan and providing results to SIGAR: Department of Defense Office of Inspector General (DoD OIG) Department of State Office of Inspector General (DoS OIG) Government Accountability Office (GAO) U.S. Agency for International Development Office of Inspector General (USAID OIG) COMPLETED OVERSIGHT ACTIVITIES Table 4.1 provides a list of completed oversight projects as of June 30, Six projects were completed this quarter. TABLE 4.1 RECENTLY COMPLETED OVERSIGHT ACTIVITIES OF OTHER U.S. AGENCIES, AS OF JUNE 30, 2009 Agency Project Number Date Issued Project Title DoD OIG D /21/2009 Afghanistan Security Forces Fund Phase III-Accountability for Weapons Distributed to the Afghanistan National Army DoD OIG D /14/2009 Afghanistan Security Forces Fund Phase III-U.S. Army Corps of Engineers Real Property Accountability GAO GAO /18/2009 Military Operations: Actions Needed to Improve Oversight and Interagency Coordination for the Commander s Emergency Response Program in Afghanistan GAO GAO SP 4/21/2009 Afghanistan: Key Issues for Congressional Oversight USAID OIG P 6/8/2009 USAID/Afghanistan s Land Titling and Economic Restructuring Project USAID OIG P 5/11/2009 USAID/Afghanistan s Local Governance and Community Development Project in Southern and Eastern Regions of Afghanistan REPORT TO THE UNITED STATES CONGRESS I JULY 30,

110 OTHER AGENCY OVERSIGHT ONGOING OVERSIGHT As of June 30, 2009, there were 22 oversight activities in progress. They are broken out by agency. The descriptions appear as they were submitted to SIGAR, with these mechanical changes for consistency with the preceding sections of this report: acronyms and abbreviations in place of repeated complete names; standardized capitalization, hyphenation, and preferred spellings; and thirdperson instead of first-person construction. Department of Defense Offi ce of Inspector General In May 2009, the DoD OIG, on behalf of the member DoD and Federal oversight agencies, issued an update to the statutorily required Comprehensive Oversight Plan for Southwest Asia, including the additional FY 2009 statutorily required oversight. The Comprehensive Oversight Plan for Southwest Asia includes the individual oversight plans of the inspectors general for the DoD, DoS, and USAID; the Special Inspector General for Iraq Reconstruction; and the SIGAR. It also includes the oversight work of the Army Audit Agency, Naval Audit Service, Air Force Audit Agency, and Defense Contract Audit Agency because of the major contributions they make to improve the efficiency and effectiveness of support to the military. The comprehensive plan was expanded beyond the statutorily mandates to include other functional areas that [DoD OIG] believe[s] are germane to supporting operations in Southwest Asia, including Operation Enduring Freedom (OEF), such as contract administration and management, reset of equipment, financial management, and reconstruction support effort. In addition, the update issued in May 2009 includes the Commander, U.S. Central Command s request for DoD OIG and the Service Audit Agencies to review asset accountability within Southwest Asia. The DoD OIG led Southwest Asia Joint Planning Group coordinates and deconflicts federal and DoD OCO related oversight activities. The Group held its ninth meeting in May During the third quarter of FY 2009, the DoD OIG expanded its Southwest Asia presence, deploying additional auditors and investigators to Iraq and Afghanistan. The additional staff support the increased oversight workload required by statutory requirements, Congressional requests, senior DoD and military officials requests, and as [DoD OIG] determine[s] based on high risks and challenges in the operations. [The] field offices in Qatar, Iraq, Kuwait, and Afghanistan enhance [the] ability to provide audit, inspection, and investigative support to DoD operations in support to OCO. During FY 2009, the DoD OIG completed and ongoing OEF-related oversight activities addressed the following areas: the use and accountability of Afghanistan Security Forces Funds accountability of property contract administration 102 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

111 OTHER AGENCY OVERSIGHT Oversight Activities INTERAGENCY AUDIT ON DOD OBLIGATIONS AND EXPENDITURES OF FUNDS PROVIDED TO THE DEPARTMENT OF STATE FOR THE TRAINING AND MENTORING OF THE AFGHAN NATIONAL POLICE (PROJECT NO. D2009-D000JB , INITIATED JUNE 5, 2009) The inspectors general of the DoD and DoS are performing this joint audit in response to a congressional request. [The] objective is to review the status of Afghanistan Security Forces Fund (ASFF) money that the DoD has provided to the DoS for the training of the Afghan National Police (ANP). Specifically, the DoD OIG will review a copy of the contract, appropriate task orders, statements of work, and any contract or task order modifications for training and mentoring to ensure they comply with all relevant federal regulations and meet the needs of the DoD. Further, [they] will review copies of contractor invoices to ensure that claimed costs are allowable, allocable, and reasonable for the services received. The DoSOIG will be assisting on this audit and will be assessing the staffing, training, contract management, and contract effectiveness of the civilian police trainers. ASSESSMENT OF U.S. AND COALITION PLANS TO TRAIN, EQUIP, AND FIELD THE AFGHAN NATIONAL SECURITY FORCES (PROJECT NO. D2009-D00SPO , INITIATED FEBRUARY 3, 2009) SPO is determining whether U.S. government, coalition, Afghan Ministry of Defense, and Afghan Ministry of Interior goals, objectives, plans, and guidance to train, equip, and field the expanded Afghan National Army (ANA) and the ANP are prepared, issued, operative, and relevant. The draft report is being prepared. ASSESSMENT OF THE ACCOUNTABILITY AND CONTROL OF ARMS, AMMUNITION, AND EXPLOSIVES (AA&E) PROVIDED TO THE SECURITY FORCES OF AFGHANISTAN (PROJECT NO.D2009-D00SPO , INITIATED FEBRUARY 3, 2009) SPO is determining whether the current accountability and control of U.S.- supplied AA&E provided to the Afghan National Security Forces (ANSF) is adequate and effective. In addition, [SPO] will follow up on the status of the implementation of recommendations made during our initial assessment of the accountability and control of AA&E in Afghanistan (see DoD OIG Report No. SPO , Assessment of Arms, Ammunition, and Explosives Control and Accountability; Security Assistance; and Sustainment for the Afghan National Security Forces, October 24, 2008). The draft report is being prepared. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

112 OTHER AGENCY OVERSIGHT ASSESSMENT OF U.S. AND COALITION EFFORTS TO DEVELOP THE MEDICAL SUSTAINMENT CAPABILITY OF THE AFGHAN NATIONAL SECURITY FORCES (PROJECT NO. D2009-D00SPO , INITIATED DECEMBER 17, 2008) SPO is determining whether U.S. government, coalition, Afghan Ministry of Defense, and Afghan Ministry of Interior goals, objectives, plans, and guidance to develop and sustain the current and projected ANSF health care system are issued and operative; previous DoD OIG recommendations regarding developing and sustaining the ANSF health care system have been implemented (see DoD OIG Report No. SPO , Assessment of Arms, Ammunition, and Explosives Control and Accountability; Security Assistance; and Sustainment for the Afghan National Security Forces, October 24, 2008); and ongoing efforts to develop an enduring health care system for the ANSF are effective. The draft report is being prepared. COMBATANT COMMAND HUMANITARIAN ASSISTANCE AND DISASTER RELIEF OPERATIONS (PROJECT NO. D2009-D000JA , INITIATED NOVEMBER 13, 2008) The DoD OIG is evaluating the ability of the Combatant Commands to plan and execute Humanitarian Assistance and Disaster Relief operations, to include support for OEF. REANNOUNCEMENT OF THE AUDIT OF FUNDS APPROPRIATED FOR AFGHANISTAN AND IRAQ PROCESSED THROUGH THE FOREIGN MILITARY SALES TRUST FUND (PROJECT NO. D2007-D000FD , INITIATED OCTOBER 10, 2008) Based on observations during audit fieldwork under the originally announced project (D2007-D000FD ), the DoD OIG determined an additional project was required to separately discuss relevant issues identified during [the] fieldwork. Accordingly, the DoD OIG addressed the transfer of funds to the FMS Trust Fund and the collection of administrative fees from these funds in Report No. D Under the second announced project (D2007-D000FD ), the DoD OIG is determining whether the funds appropriated for the security, reconstruction, and assistance of Afghanistan and Iraq and processed through the Foreign Military Sales Trust Fund are being properly managed. However, the DoD OIG has reduced the sub-objectives to determining whether the appropriated funds transferred into the Foreign Military Sales Trust Fund are properly accounted for, used for the intended purpose, and properly reported in DoD financial reports. 104 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

113 OTHER AGENCY OVERSIGHT UPDATE SUMMARY REPORT ON CHALLENGES IMPACTING OPERATIONS IRAQI FREEDOM AND ENDURING FREEDOM REPORTED BY MAJOR OVERSIGHT ORGANIZATIONS BEGINNING FY 2003 THROUGH FY 2008 (PROJECT NO. D2008-D000JC , INITIATED AUGUST 28, 2008) The DoD OIG is preparing a summary of contracts, funds management, and other accountability issues identified in audit reports and testimonies that discuss mission critical support to Operations Iraqi Freedom and Enduring Freedom from FY 2003 through FY The first DoD OIG summary report, D , focused on reports and testimonies issued from FY 2003 through FY The DoD OIG will update the information from the prior summary report, Report No. D , to include the status of recommendations made in all FY 2003 through FY 2007 reports regarding Operations Iraqi Freedom and Enduring Freedom. In addition, the DoD OIG will include finding and recommendation information for FY 2008 audit reports and determine the trends indicated by that information. CONTRACTS SUPPORTING THE DOD COUNTER NARCOTERRORISM PROGRAM (PROJECT NO. D2008-D000AS , INITIATED JULY 31, 2008) The DoD OIG is determining whether contracts supporting the DoD counter narcoterrorism program were properly managed and administered. Specifically, the DoD OIG will determine whether the contracts complied with Federal and DoD policy. DISTRIBUTION OF FUNDS AND THE VALIDITY OF OBLIGATIONS FOR MANAGEMENT OF THE AFGHANISTAN SECURITY FORCES FUND-PHASE III (PROJECT NO. D2007-D000LQ , INITIATED DECEMBER 10, 2007) The DoD OIG is conducting the third phase of a multiphase audit in response to Public Law , which directed the inspector general to provide oversight of Afghanistan Security Forces. A series of reviews under this third phase is planned to determine whether organizations in Southwest Asia that the U.S. Central Command assigned with the responsibility for managing the ASFF properly accounted for the goods and services purchased for the Afghanistan Security Forces using the ASFF and whether the goods and services were properly delivered to the Afghanistan Security Forces. Report D , Distribution of Funds and the Validity of Obligations for the Management of the Afghanistan Security Forces Fund, December 29, 2008, addresses Afghanistan Security Forces funded real property construction listed on contracts awarded by Air Force Center for Engineering and the Environment. Report D , Afghanistan Security Forces Fund Phase III - Accountability for Weapons Distributed to the Afghanistan National Army, April 14, 2009, addresses accountability REPORT TO THE UNITED STATES CONGRESS I JULY 30,

114 OTHER AGENCY OVERSIGHT for weapons distributed to the Afghanistan National Army. Report D , Afghanistan Security Forces Fund Phase III - U.S. Army Corps of Engineers Real Property Accountability, May 21, 2009, addresses U.S. Army Corps of Engineers real property accountability. Department of State Offi ce of Inspector General - Middle East Regional Offi ce (DoS OIG MERO) Oversight Activities AFGHANISTAN NATIONAL POLICE TRAINING AND MENTORING PROGRAM (JOINT W/DODIG) (PROJECT NO. 09-MERO-3009, INITIATED JUNE 2009) Objectives - To provide an overall review and summary of the requirements, provisions, and costs of the ANP Training and Mentoring Program contract; objectives of the contracts and task orders, what indicators have been established to measure performance; and how the DoS administered the contract to oversee DynCorp s performance and costs of the contract. Assess the status of contract records, management controls, costs, and value of this contract to the mission of the DoS and DoD. EFFECTIVENESS OF COUNTER NARCOTICS PROGRAMS IN AFGHANISTAN (PROJECT NO. 09-MERO-3004, INITIATED APRIL 2009) Objectives - To assess U.S. efforts to plan and manage counter-narcotics activities in Afghanistan, including an analysis of (1) U.S. obligations and expenditures, (2) results of assistance projects, (3) assistance coordination mechanisms and strategy, and (4) major obstacles that affect the achievement of U.S. goals. PERSONAL SECURITY DETAIL (WPPS) CONTRACTS AFGHANISTAN, (UNITED STATES TRAINING CENTER (USTC)) PROJECT NO. 09-MERO-3005, INITIATED MARCH 2009) Objectives - To review the requirements and provisions of the WPPS contract; objectives of the contracts and task orders, what indicators have been established to measure performance; and how the Department administered the contract to oversee United States Training Center s (formerly Blackwater) of the WPPS contract. DIPLOMATIC SECURITY (DS) MANAGEMENT OF WPPS AFGHANISTAN (PROJECT NO. 09-MERO-3006, INITIATED MARCH 2009) Objectives - To review what studies and needs assessments were conducted by the Bureau of Diplomatic Security to determine PPS requirements in Afghanistan and what mechanisms are in place to ensure personal protective services assets are utilized in an efficient and effective manner. 106 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

115 OTHER AGENCY OVERSIGHT Government Accountability Offi ce (GAO) During the last quarter, GAO issued a special product (GAO SP) that identified and highlighted several oversight issues relating to U.S. efforts in Afghanistan for the 111th Congress and new administration. This special publication highlighted key issues for consideration in developing oversight agendas and determining the way forward in securing and stabilizing Afghanistan. It also identified improvements that were needed as well as many obstacles that affect success and should be considered in program planning and implementation. For most of the U.S. efforts in the past, GAO found the need for improved planning, including the development of coordinated interagency plans that include measurable goals, specific time frames, cost estimates, and identification of external factors that could significantly affect efforts in key areas such as building the ANSF. GAO also concluded that several existing conditions, such as worsening security; shortages in mentors and trainers; the lack of a coordinated, detailed interagency plan; and the limited institutional capacity of the Afghanistan government continue to create challenges to the U.S. efforts to assist with securing, stabilizing, and rebuilding Afghanistan. GAO noted that significant oversight will be needed to help ensure visibility over the cost and progress of these efforts. GAO suggested areas for additional oversight on the following topics: U.S. and international commitments Security environment U.S. forces and equipment ANSF Counternarcotics efforts Economic development Government capacity Accountability for U.S. provided weapons Oversight of contractor performance Oversight Activities AFGHAN WATER SECTOR: REVIEW OF U.S. EFFORTS TO ASSIST WITH THE DEVELOPMENT OF THE AFGHAN WATER SECTOR (PROJECT NO , INITIATED MAY 8, 2009 ) Scope focused on U.S. efforts to assist Afghanistan in achieving the Afghanistan National Development Strategy (ANDS) goal of supplying clean potable water, sanitation, and crop irrigation services in Afghanistan. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

116 OTHER AGENCY OVERSIGHT REVIEW OF U.S. ALTERNATIVE DEVELOPMENT AND GOOD PERFORMER INITIATIVE PROGRAM IN AFGHANISTAN (PROJECT NO , INITIATED MARCH 16, 2009) Focused on funding, goals, results, coordination efforts, and efforts to mitigate any challenges. AGENCY OVERSIGHT OF CONTRACTORS MANAGING AND ADMINISTERING OTHER CONTRACTS OR GRANTS IN IRAQ AND AFGHANISTAN (PROJECT NO , INITIATED FEBRUARY 19, 2009) This review will focus on DoD, DoS, and USAID efforts to effectively oversee contractors performing management or administration functions for other contracts or grants with performance in Iraq/Afghanistan. AFGHAN COUNTERNARCOTICS (PROJECT NO , INITIATED JANUARY 29, 2009) Review of U.S. efforts to assist with interdiction, eradication, judicial, and public information campaign efforts. CONTRACTING IN AFGHANISTAN/IRAQ (PROJECT NO , INITIATED NOVEMBER 25, 2008) This review will identify the number and value of contracts, numbers of contractors performing in country, and numbers of contractor personnel killed or wounded. U.S. Agency for International Development Offi ce of Inspector General (USAID OIG) Oversight Activities AUDIT OF SELECTED POWER SECTOR ACTIVITIES FUNDED UNDER USAID/AFGHANISTAN S INFRASTRUCTURE AND REHABILITATION PROGRAM Objective: Evaluate whether USAID/Afghanistan s main goals for critical power sector activities under the Afghanistan Infrastructure and Rehabilitation Program are being achieved, and what has been the impact. AUDIT OF USAID/AFGHANISTAN S BUILDING EDUCATION SUPPORT SYSTEMS FOR TEACHERS PROJECT Objective: Evaluate whether USAID/Afghanistan s Building Education Support Systems for Teachers project is achieving its main goals. 108 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

117 OTHER AGENCY OVERSIGHT USAID/AFGHANISTAN S SCHOOL AND HEALTH CLINIC BUILDINGS COMPLETED UNDER THE SCHOOLS AND CLINICS CONSTRUCTION AND REFURBISHMENT (SACCARP) PROGRAM Objective: Determine whether the school and health clinic buildings completed under the program are being used for their intended purposes, and measure the impact of the program on the provision of educational and health services to the people of Afghanistan. USAID/AFGHANISTAN S AFGHAN CIVILIAN ASSISTANCE PROGRAM Objective: Determine whether USAID/Afghanistan s humanitarian assistance services provided through the Afghan Civilian Assistance Program are on target to assist eligible beneficiaries under the program, and to evaluate the impact. OTHER AGENCY INVESTIGATIONS SIGAR regularly coordinates with other government agencies conducting investigations in Afghanistan, to monitor the progress of those investigations. As of June 30, 2009, there were 42 investigators located at various sites working on 48 open cases. Table 4.2 provides a summary of ongoing oversight activities performed by other government agencies as of June 30, TABLE 4.2 ONGOING OVERSIGHT ACTIVITIES OF OTHER U.S. AGENCIES, AS OF JUNE 30, 2009 Agency Project Number Date Initiated Project Title DoD OIG D2009-D000JB /5/2009 Interagency Audit on DoD Obligations and Expenditures of Funds Provided to Department of State for the Training and Mentoring of the Afghan National Police DoD OIG D2009-D00SPO /3/2009 Assessment of U.S. and Coalition Plans to Train, Equip, and Field the Afghan National Security Forces DoD OIG D2009-D00SPO /3/2009 Assessment of the Accountability and Control of Arms, Ammunition, and Explosives Provided to the Afghan National Security Forces DoD OIG D2009-D00SPO /17/2008 Assessment of U.S. and Coalition Efforts to Develop the Medical Sustainment Capability of the Afghan National Security Forces DoD OIG D2009-D000JA /13/2008 Combatant Command Humanitarian Assistance and Disaster Relief Operations DoD OIG D2007-D000FD /10/2008 Re-announcement of the Audit of Funds Appropriated for Afghanistan and Iraq Processed Through the Foreign Military Sales Trust Fund DoD OIG D2008-D000JC /28/2008 Update Summary Report on Challenges Impacting Operations Iraqi Freedom and Enduring Freedom Reported by Major Oversight Organizations Beginning FY 2003 through FY 2008 DoD OIG D2008-D000AS /31/2008 Contracts Supporting DoD Counter Narcoterrorism Program (continued on next page) REPORT TO THE UNITED STATES CONGRESS I JULY 30,

118 OTHER AGENCY OVERSIGHT TABLE 4.2 (CONTINUED) ONGOING OVERSIGHT ACTIVITIES OF OTHER U.S. AGENCIES, AS OF JUNE 30, 2009 Agency Project Number Date Initiated Project Title DoD OIG D2007-D000LQ /10/2007 Distribution of Funds and the Validity of Obligations for Management of the Afghanistan Security Forces Fund-Phase III DoS OIG MERO 09-MERO-3009 June 2009 Afghanistan National Police Training and Mentoring Program (Joint w/dodig) DoS OIG MERO 09-MERO-3004 April 2009 Effectiveness of Counter Narcotics Programs in Afghanistan DoS OIG MERO 09-MERO-3005 March 2009 Personal Security Detail (WPPS) Contracts Afghanistan, (United States Training Center (USTC)) DoS OIG MERO 09-MERO-3006 March 2009 Diplomatic Security (DS) Management of WPPS - Afghanistan GAO /8/2009 Afghan Water Sector: Review of U.S. Efforts to Assist with the Development of the Afghan Water Sector GAO /16/2009 Review of U.S. Alternative Development and Good Performer Initiative Program in Afghanistan GAO /19/2009 Agency Oversight of Contractors Managing and Administering Other Contracts or Grants in Iraq and Afghanistan GAO /29/2009 Afghan Counternarcotics GAO /25/2008 Contracting in Afghanistan/Iraq ÚSAID OIG Not provided Not provided Audit of Selected Power Sector Activities Funded Under USAID/Afghanistan s Infrastructure and Rehabilitation Program USAID OIG Not provided Not provided Audit of USAID/Afghanistan s Building Education Support Systems for Teachers Project USAID OIG Not provided Not provided USAID/Afghanistan s School and Health Clinic Buildings Completed Under the Schools and Clinics Construction and Refurbishment (SACCARP) Program USAID OIG Not provided Not provided USAID/Afghanistan s Afghan Civilian Assistance Program Defense Criminal Investigative Service (DCIS) The DCIS continues to conduct criminal investigations in support of DoD OCO efforts. In addition, the DCIS continues to address Southwest Asia Theater criminal activity through its offices in Southwest Asia; Wiesbaden, Germany; and CONUS task force investigations focusing on public corruption and fraud in the Southwest Asia Theater. Special Agents will occasionally travel to the Middle East as necessary from Germany and the United States in furtherance of the DCIS investigative mission. Investigations primarily involve procurement fraud and public corruption. As of June 30, 2009, DCIS has 38 agents working cases involving Afghanistan. Of those 38 agents, 3 agents are deployed to Afghanistan. Investigations During the third quarter of FY 2009, a DCIS joint case resulted in a conviction of former contractor involved in the theft of more than 48 truckloads of fuel, valued at more than $800,000. They were diverted for sale outside Bagram airfield between May and September During the third quarter of FY 2009, a DCIS investigation regarding contracting at Bagram Airfield resulted in two U.S. military officials pleading guilty 110 SPECIAL INSPECTOR GENERAL I AFGHANISTAN RECONSTRUCTION

119 OTHER AGENCY OVERSIGHT to various bribery, fraud and conspiracy charges relating to DoD contracts in Afghanistan. A third military official pleaded guilty to receiving stolen property, which was obtained through the bribery conspiracy. In addition, four DoD contractors and four affiliated contracting companies were indicted for their roles in paying bribes to the military officials and otherwise defrauding the United States. Table 4.3 lists the number of ongoing and closed cases to date, as well as the number of investigators working those cases. OTHER AGENCY INSPECTIONS Ongoing Inspections SIGAR also coordinates with other agencies conducting inspections in Afghanistan. During the previous quarter, DoS OIG initiated two investigations, as described in Table 4.4. TABLE 4.3 INVESTIGATIVE ACTIVITIES: OTHER AGENCY INVESTIGATIONS Agency Number of Investigators in Afghanistan Total Number of Investigators Open Cases Closed Cases Total Cases Defense Criminal Investigative Service DoS OIG Total TABLE 4.4 ONGOING INSPECTION ACTIVITIES: OTHER AGENCY INSPECTIONS Agency Project Number Date Initiated Project Title Objective DoS OIG 09-ISP-3051 April 2009 De-mining Programs in Afghanistan To evaluate the implementation and effectiveness of de-mining programs in Afghanistan. DoS OIG 09-ISP-3059 April 2009 Review of Radio Deewa To review and determine whether policy and program goals of Radio Deewa are being effectively achieved and to provide analysis and recommendations for systemic improvements in policy implementation and program management. REPORT TO THE UNITED STATES CONGRESS I JULY 30,

120 The Official Seal of the SIGAR The Official Seal of the SIGAR represents the coordination of efforts between the United States and Afghanistan to provide accountability and oversight in reconstruction activities. The phrase along the top side of the seal s center is in Dari and, translated into English, means SIGAR. The phrase along the bottom side of the seal s center is in Pashtu and as translated into English, has the same meaning.

121 APPENDICES AND ENDNOTES Introduction: The Year of Transfer Rise in Income Expanding Iraqi Security Authority Afghanistan Reconstruction Update Afghanistan Audits Afghanistan Inspections Reconstruction Teams The Role of the International Community Anticorruption Efforts Security Security Conditions Still Hinder Reconstruction Activities Concerned Local Citizen Initiative Legislative Developments The Human Toll